Personal consumption expenditures (PCE) increased by USD 54.4 billion, or 0.4 percent, in November, following an upwardly revised USD 108.7 billion rise, or 0.8 percent, in October. The increase in consumption was mainly due to durable goods (0.9 percent vs 0.8 percent in October). Meanwhile, consumption of non-durable goods (0.2 percent vs 0.9 percent) and services (0.4 percent vs 0.7 percent) slowed.
Real PCE advanced by USD 42.5 billion, or 0.3 percent in November reflecting a gain of USD 32.6 billion in spending for goods and a USD 13.2 billion rise in spending for services. Within goods, recreational goods and vehicles was the leading contributor to the increase. Within services, the largest contributor to the gain was spending for household electricity and gas.
Personal income went up USD 40.2 billion, or 0.2 percent in November, after a USD 88.0 billion, or 0.5 percent gain in October and lower than market consensus of a 0.3 percent gain. Increases in wages and salaries and in farm proprietors’ income were partially offset by declines in personal dividend income and social security benefits. Farm proprietors’ income increased USD 14.9 billion in November, which included subsidy payments associated with the Department of Agriculture’s Market Facilitation Program.
Personal outlays rose USD 56.6 billion in November. Personal saving was USD 944.2 billion in November and the personal saving rate, personal saving as a percentage of disposable personal income, was 6.0 percent.
Disposable personal income (DPI) grew USD 37.8 billion, or 0.2 percent, in November. Real DPI went up 0.2 percent.
The PCE price index increased 0.1 percent month-over-month in November, following a 0.2 percent rise in the previous month while markets were expecting no growth. Cost of goods fell by 0.3 percent, compared with a 0.2 percent increase in October, as nondurables declined 0.5 percent (vs 0.3 percent in October) and durable goods edged up 0.1 percent, the same as in the prior month. Meanwhile, prices of services went up 0.2 percent, the same pace as in the previous five months. Excluding food and energy, PCE prices were up 0.1 percent, the same as in the previous month and in line with market expectations. Year-on-year, the PCE price index advanced 1.8 percent, following a 2 percent gain in the prior month, and the core index rose 1.9 percent, above a 1.8 percent gain in October.