WASHINGTON — Personal income rose 0.2% in September, while nominal PCE was down 0.2% and the core PCE price index rose 0.1% in the month and 1.5% year/year, data released by the Commerce Department Friday morning showed.
The core price index's 1.5% year/year rise in September was fifth such increase in a row and remains well below the Fed's 2.0% inflation target.
Analysts had expected personal income to rise 0.3% in the month, while nominal PCE and the core price index were both expected to be up 0.1%.
The weaker-than-expected 0.2% decline in current dollar PCE followed a 0.5% increase in August. In both cases, motor vehicle sales were a key factor according to the Commerce Department.
Spending on durable goods fell 2.0% in September following a 2.1% jump in August, with vehicle and parts sales accounting for "most" of the durables movement. Nondurable goods spending was fell 0.3% in September, continuing their downward trend, while services spending rose 0.2%.
Real PCE also fell 0.2% in September, after rising by 0.5% in August, as the overall PCE price index rose only 0.1% in the month. The price index was up 1.4% year/year, the same growth rate seen in August. Energy prices fell in September and from a year ago, while food prices were up month/month and year/year.
There was a similar pattern of contributions for real PCE as there was for nominal PCE, with a 1.9% decline in durable goods PCE and a 0.3% decline in nondurable goods PCE offsetting a 0.1% rise in services PCE. The decline in real nondurables PCE, identical to the drop in nominal nondurables PCE, suggests that decline was not entirely due to lower energy price.
Wages and salaries grew 0.2% in the month, while other income categories were mixed. Transfer receipts and rental income rose, while proprietors income and personal interest income declined.
Disposable personal income rose 0.1% in the month, while real disposable income was flat. The saving rate rose to 5.6% in September from 5.4% in August.
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