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savings rate

personal spending

Personal Spending Remained Soft in March Despite Decent Income Growth

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The Bureau of Economic Analysis said that personal spending remained soft in March, up just 0.1 percent, despite decent income growth. Personal consumption expenditures had increased by 0.2 percent in January and February. Reduced motor vehicle spending in March helped to drag down durable goods spending by 0.6 percent, but this was offset by a similar increase in nondurable goods purchases. With slower spending, the savings rate rose to 5.4 percent, its highest level since February 2015. Despite this, personal consumption expenditures continued to grow at a modest pace year-over-year, down from 3.9 percent in February to 3.5 percent in March. As such, consumer spending remains one of the brighter spots in the U.S. economy, even as it remains clear that Americans might be holding back somewhat from making larger purchases. Read More

personal spending

Personal Spending Data Reflect a Public That Continues to Hold Back on Purchases

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The Bureau of Economic Analysis said that personal spending rose 0.1 percent in February. More importantly, personal consumption expenditures were revised sharply lower for January, up just 0.1 percent instead of the original estimate of a 0.5 percent gain for the month. As such, the rebound seen in the prior report evaporated, suggesting that the public remains hesitant when opening their wallets. Durable goods expenditures increased by 0.3 percent in February, boosted by growth in autos and furniture spending, but have declined in three of the past four months. In contrast, purchases of nondurable goods fell for the second straight month, off 0.3 percent in February.

With slower spending, the savings rate inched up to 5.4 percent, its highest level in 12 months. On a year-over-year basis, personal spending has risen 3.8 percent since February 2015, down from 3.9 percent in the prior release. Therefore, even as Americans are apparently holding back somewhat, consumer spending continues to expand modestly overall. Read More

Personal Spending Improved in January from Softness in December

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The Bureau of Economic Analysis said that personal spending increased 0.5 percent in January, its strongest monthly gain since May. This represented a nice improvement after personal consumption expenditures rose just 0.1 percent in December. The jump in January stemmed mostly from an increase in durable goods spending, up 1.2 percent, with nondurable goods purchases unchanged in this report. Spending on services were also higher, up 0.6 percent. On a year-over-year basis, personal spending has risen 4.2 percent since January 2015, up from 3.2 percent in the prior release. This suggests that personal spending has rebounded somewhat after slowing at the end of 2015, bottoming out at 3.0 percent in October. Read More

personal spending

Personal Spending Slowed at Year’s End

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The Bureau of Economic Analysis said that personal spending slowed in December, up just 0.1 percent following a 0.5 percent increase in November. As such, it suggests that Americans pulled back their purchases at year’s end, mirroring other data showing soft retail sales. Indeed, durable and nondurable goods spending were both lower for the month, down 0.7 percent and 0.2 percent, respectively. Reduced motor vehicle sales (down 3.3 percent) pulled the durable goods figure lower. Service sector spending was up 0.3 percent. With that said, personal consumption expenditures have risen 3.2 percent over the past 12 months, a modest pace. This was down, however, from 4.0 percent one year ago. Read More

The Savings Rate Rose to a Nearly Three-Year High

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The Bureau of Economic Analysis said that personal spending remained soft, up 0.1 percent in October, the same pace as seen in September. Spending on durable and nondurable goods increased by 0.2 percent and 0.1 percent, respectively, but these data were held back by weaker spending on food and beverages (down 0.8 percent), motor vehicles and parts (down 0.7 percent) and gasoline and other energy goods (down 0.3 percent). The latter was likely the result of lower gasoline prices. Overall, these data tend to show that Americans are holding back a little on their consumer purchases, with the year-over-year pace of personal spending down from 4.7 percent in October 2014 to 2.9 percent in this most recent report. On the positive side, this suggests positive growth, and yet, these data also indicate that the public is saving more. The savings rate rose to 5.6 percent, its highest rate of the year so far and up from 4.5 percent twelve months ago. It was also the highest level since December 2012, when the data were skewed by the possibility of the “fiscal cliff.” Read More

Personal Income and Spending Growth Slowed in September

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The Bureau of Economic Analysis said that personal income growth slowed to 0.1 percent in September, down from 0.4 percent growth in each of the prior five months. As such, it was the slowest income growth since March. With that said, personal income growth has remained at fairly decent levels, up 4.1 percent year-over-year in September, but this was down from 5.2 percent in December. Total manufacturing wages and salaries declined from $797.7 billion in August to $792.8 billion in September. Nonetheless, the longer-term trend has been mainly positive for the sector, with manufacturing wages and salaries totaling $746.8 billion and $780.9 billion on average in 2013 and 2014, respectively. Read More

Modest Growth in Personal Income and Spending in August

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The Bureau of Economic Analysis said that personal spending increased by 0.4 percent in August, mirroring the gain seen in July. It has not been positive for six consecutive months, after essentially stagnating in February. Durable and nondurable goods spending were both higher for the month, up 1.2 percent and 0.6 percent, respectively. Motor vehicles and parts helped to buoy the durable goods purchasing numbers in each of the past two months, up 1.6 percent and 2.1 percent in July and August, respectively, and rebounding from the 3.4 percent decline in June. On a year-over-year basis, personal spending has increased by 3.5 percent, down from 3.7 percent in the prior report. In general, this suggests that Americans are increasing their spending modestly, but it also indicates a slower rate of purchasing than the more-robust pace seen in late 2014. For instance, the year-over-year rate peaked at 5.0 percent in 2014 in August. Read More

Modest Growth in Personal Income and Spending in July

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The Bureau of Economic Analysis said that personal income increased 0.4 percent, marking the fourth straight month with that pace. Over the course of the past 12 months, personal incomes have risen 4.3 percent, up from 4.1 percent in the last report. Total manufacturing wages and salaries were $793.2 billion in July, up from $788.5 billion in June. This continues an upward trend for the sector, with manufacturing wages and salaries totaling $746.8 billion and $780.9 billion on average in 2013 and 2014, respectively. Read More

Personal Spending Growth Eased Somewhat in June

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The Bureau of Economic Analysis said that personal spending increased by 0.2 percent in June, easing somewhat from the 0.7 percent growth rate observed in May. This was the slowest pace since February, but on the positive side, spending has now risen for five straight months. On a year-over-year basis, real personal consumption expenditures have risen 2.9 percent since June 2014, down from 3.4 percent in May. Through the first half of 2015, year-over-year growth in personal spending has averaged 3.2 percent, representing modest growth. Still, the June data were challenged by weaker-than-desired growth in goods spending, particularly for durable goods. Read More

Personal Spending Picked Up Strongly in May

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The Bureau of Economic Analysis said that personal spending rose 0.9 percent in May, rebounding from a more-cautious 0.1 percent growth rate observed in April. It was the fastest monthly growth rate since August 2009. From the manufacturing perspective, this was welcome news, with spending on durable and nondurable goods up 2.2 percent and 1.9 percent, respectively. More importantly, it provides some encouragement that Americans might return to opening their wallets – something that there has been more hesitance to do so far this year. The year-over-year rate of personal spending in May, 3.6 percent, was the highest since December, up from 3.1 percent since in April. Read More