2012 Economic Calendar
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Personal Income and Outlays  
Released On 3/1/2012 8:30:00 AM For Jan, 2012
PriorPrior RevisedConsensusConsensus RangeActual
Personal Income - M/M change0.5 %0.5 %0.2 % to 0.8 %0.3 %
Consumer Spending - M/M change0.0 %0.4 %0.2 % to 0.6 %0.2 %
Core PCE price index - M/M change0.2 %0.1 %0.2 %0.1 % to 0.2 %0.2 %
Personal Income - Yr/Yr change3.8 %4.6 %3.6 %
Consumer Spending - Yr/Yr change3.9 %4.0 %3.8 %
Core PCE price index - Yr/Yr change1.8 %1.9 %1.9 %
Personal Outlays - $ level11.184 thous billion $

Personal income growth slowed but remained healthy in January while spending improved a little. Personal income in January increased 0.3 percent after a 0.5 percent boost the month before. The January advance came in lower than market expectations for a 0.5 percent surge. The important wages & salaries component advanced 0.4 percent, matching December's growth rate.

Consumer spending in January improved to a 0.2 percent gain from no change in December. The market median forecast was for a 0.4 percent increase. The goods components were relatively strong as durables gained 0.9 percent after a 0.5 percent increase in December. Nondurables, lifted by higher gasoline prices, increased 0.4 percent, following a 0.8 percent drop in December. Services held back overall spending with no change in January after a 0.2 percent rise the month before. Weakness was likely related to soft utilities tied to mild winter weather.

Inflation at the headline and core levels was moderately warm. The headline PCE price index heated up somewhat to 0.2 percent from 0.1percent in December. The market median forecast was for a 0.2 percent rise in January. The core rate firmed to 0.2 percent, also from 0.1 percent in December. Analysts expected a 0.2 percent increased.

Year-on-year, headline prices were up 2.4 percent, compared to 2.5 percent in December. The core was up 1.9 percent, matching the prior month's pace.

Inflation is keeping real spending soft. Chain dollar PCEs were flat each month for November through January. The durables component has been posting gains while nondurables has been negative to flat and services has been flat in recent months. The PCEs component for first quarter GDP is looking anemic at this point.

Today's report showed continued gains in the consumer sector but at a modest pace. Spending was mixed but better than seen in the earlier retail sales report. While the services weakness likely will not last when weather returns to normal, higher gasoline prices are eating into real income and real spending. However, this morning's dip in initial jobless claims is encouraging.

Consensus Outlook
Personal income in December advanced 0.5 percent, following a 0.1 percent rise the prior month. The important wages & salaries component grew a healthy 0.4 percent after no change in November. However, consumer spending in December was sluggish, coming in at flat after edging up 0.1 percent in November. The headline PCE price index firmed a bit to a 0.1 percent rise after no change in November. The core pace was a touch warmer at 0.2 percent in December, compared to 0.1 percent in November and expectations of 0.1 percent. Looking ahead, the private wages & salaries component of income in January should be moderately healthy as aggregate weekly earnings gained 0.4 percent for the month. The goods components of personal spending should be robust as unit new motor vehicle sales spiked 4.6 percent in January while retail sales excluding autos jumped 0.7 percent. On the inflation front, PCE inflation should be a little warm as both headline and core CPIs rose 0.2 percent in January.

Personal income represents the income that households receive from all sources including wages and salaries, fringe benefits such as employer contributions to private pension plans, proprietors' income, income from rent, dividends and interest and transfer payments such as Social Security and unemployment compensation. Personal contributions for social insurance are subtracted from personal income.

Personal consumption expenditures are the major portion of personal outlays, which also include personal interest payments and transfer payments. Personal consumption expenditures are divided into durable goods, nondurable goods and services. These figures are the monthly analogues to the quarterly consumption expenditures in the GDP report, available in nominal and real (inflation-adjusted) dollars. Economic performance is more appropriately measured after the effects of inflation are removed.

Each month, the Bureau of Economic Analysis also compiles the personal consumption expenditure price index, also known as the PCE price index. This inflation index measures a basket of goods and services that is updated annually in contrast to the CPI, which measures a fixed basket.

 Why Investors Care
Changes in taxes or social security cost of living adjustments can cause some sharp variations in monthly disposable income growth. However, on the whole, monthly changes in disposable income fluctuate less than monthly changes in personal consumption expenditures.
Data Source: Haver Analytics
Monthly changes in personal consumption expenditures are usually skewed by large changes in spending on durable goods. Spending on nondurable goods and services tend to be less volatile from one month to the next.
Data Source: Haver Analytics

2012 Release Schedule
Released On: 1/303/13/304/306/16/297/318/309/2810/2911/3012/21
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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