Personal income grew 0.4% monthly and 4.3% yearly spurring expectations about possible increase of consumption, especially in line with the higher growth of wages rather than income by rental services showed high contribution in 1st half this year and disposable personal income.
Yet, personal consumption expenditures showed lower growth than income continuously. So, saving rate rose to 4.9% from 4.7% in a previous month. It is somewhat curious that this means whether upside potential for increasing demands or broken-link between income and consumption due to structural problems so-called secular stagnation...
However, in real-terms, the yearly growth of real disposable income and expenditures are showing similar yearly growth rate, 3.3% and 3.2%, respectively.
That said, total personal income has been diverged from consumption because higher income class, who has lower marginal propensity to consume, has expanding their income more speedy.
However, on a disposable income side, it linked with consumption expenditures well, although their two growth rates are somewhat muted at about mid of 3% than previous year's more than 4%...
But, in real-term, the growth of both are showing higher number than previous year's data, from 2.7% to 3.3% and 3.2% in July this year.
So, increase in wage would be a key factor for future's US consumption economy from now...
Meanwhile, PCE price index remains low. It rose only 0.1% monthly... Maybe this could limit the decision of Fed, for now, at least.
| Personal Income & Outlays (%) | Jul | Jun | May | Y/Y | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|
| Personal Income | 0.4 | 0.4 | 0.4 | 4.3 | 4.4 | 1.1 | 5.0 |
| Wages & Salaries | 0.5 | 0.2 | 0.4 | 4.2 | 5.1 | 2.7 | 4.5 |
| Disposable Personal Income | 0.5 | 0.4 | 0.4 | 3.6 | 4.2 | -0.1 | 5.1 |
| Personal Consumption Expenditures | 0.3 | 0.3 | 0.8 | 3.5 | 4.2 | 3.1 | 3.4 |
| Personal Saving Rate | 4.9 | 4.7 | 4.6 | 4.8 (Jul '14) | 4.8 | 4.8 | 7.6 |
| PCE Chain Price Index | 0.1 | 0.2 | 0.3 | 0.3 | 1.4 | 1.4 | 1.9 |
| Less Food & Energy | 0.1 | 0.1 | 0.1 | 1.2 | 1.5 | 1.5 | 1.9 |
| Real Disposable Income | 0.4 | 0.2 | 0.1 | 3.3 | 2.7 | -1.4 | 3.1 |
| Real Personal Consumption Expenditures | 0.2 | 0.0 | 0.5 | 3.2 | 2.7 | 1.7 | 1.5 |
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