WASHINGTON – Personal income rose 0.6% in October, while nominal personal consumption expenditures was up only 0.3% and the core PCE price index rose 0.1% in the month and still 1.7% year on year, data released by the Commerce Department Wednesday morning showed.

The core price index's 1.7% year/year rise in October was unchanged from the previous two months and remains well below the Federal Reserve's 2.0% inflation target. The rate has held between 1.6% and 1.7% every month in 2016, up from a 1.4% average 12-month gain in 2015.

The overall PCE price index rose 0.2% on a 3.8% energy gain and was up 1.4% year/year, an acceleration from the 1.2% year/year rate in September and the strongest year/year pace since 1.5% in October 2014.

The 0.3% gain in current dollar PCE followed a 0.7% surge in September. Spending on durable goods rose 1.0% in the month, while nondurable goods spending was up 1.4% and services spending fell 0.2%.

Real PCE rose only 0.1% in October, after rising by 0.5% in September. There was a similar pattern of contributions for real PCE as there was for nominal PCE, with a 1.0% gain in real durable goods PCE and a 0.8% increase in nondurables after inflation adjustment. Real services PCE fell 0.3%.

October real PCE was up 1.4% at an annual rate from the third quarter average, an MNI calculation showed. This represents a slowdown from the 2.8% gain posted in third quarter.

Wages and salaries grew 0.5% in the month, adding to gains in the other income categories for a fourth straight month.

Disposable personal income rose 0.6% in the month, while real disposable income was up 0.4%. The saving rate rebounded to 6.0% in October from 5.7% in September.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.