WASHINGTON — Personal income rose 0.3% in November, while nominal PCE was up 0.6% 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 November was slightly ahead of the 1.4% year/year rate in October due to base effects. While it was the strongest year/year gains since June, it remains well below the Fed's 2.0% inflation target.
Analysts had expected personal income to rise 0.4% in the month, while nominal PCE was expected to rise 0.4% and the core price index was forecast to be up 0.1%.
Wages and salaries grew 0.4% in the month, while other income categories were generally higher, with the notable exception of a decline in transfer payments.
Disposable personal income rose 0.4% in the month, while real disposable income was up only 0.1%. The saving rate slipped to 2.9% in November from 3.2% in October, hitting its lowest point since 2.5% in November 2007.
The 0.6% jump in current dollar PCE followed a 0.2% gain in October. Spending on durable goods were flat in the month, but nondurable goods spending surged 1.2% on a spike in energy prices. Services spending was up 0.6%.
Real PCE rose 0.4% in November, after holding steady in October, as the overall PCE price index rose 0.2% on a 4.3% surge in energy prices. The overall price index was up 1.8% year/year, an acceleration from the 1.6% year/year rate in October and the highest since March.
After inflation adjustment, durable goods PCE was up 0.2% while nondurable goods PCE was up only 0.7%, compared with the 1.2% nominal rise. Real services PCE was up 0.4%.
Through the first two months, the real PCE level for the fourth quarter was up 2.5% at an annual rate from the third quarter average. Real PCE was up 2.2% in third quarter based on the GDP data released Thursday.
