WASHINGTON - Personal income rose 0.1% in January, while personal consumption increased 0.5% as disposable personal income fell for the first time since July, the Commerce Department reported today.
Core PCE, which excludes food and energy costs, was flat for the month and increased 1.4% from a year ago following a 1.5% year-over-year increase in December.
Disposable personal income fell 0.4% in January reflecting an increase in federal nonwithheld income taxes.
Economists expected consumption and income to each increase 0.4%, according to the median estimate from Thomson Reuters. Economists estimated the PCE deflator would be flat for the month.
Personal consumption increased 0.3% in December, revised higher from a 0.2% gain originally reported. Income was revised lower to a 0.3% rise from the 0.4% jump reported last month.
The personal savings rate, disposable personal income minus personal outlays, fell to 3.3% in January, the lowest savings rate since October 2008. The savings rate was 4.2% in December.
For all of 2009, personal income decreased 1.7%, the largest drop since 1938, and disposable personal income increased 1.1%. The difference between the two reflects a sharp decrease in personal current taxes in 2009. Personal current taxes decreased 23.1% in 2009 compared to a 3.9% decrease in 2008.
Personal consumption dropped 0.4% in 2009, the largest decline since 1938.
