FXstreet.com (Barcelona) - Personal Consumption expenditures rose by 1.1% in November, a $110.6 billion dollars increase, following the upwardly revised 0.4% rise posted in October, according to the latest information by Bureau of Economic Analysis.
Market consensus was a lower increase by 0.6% on the month. Personal income rose by 0.4% in November, above the 0.2% increase registered in October, but slightly below market expectations of a 0.5% increase. In current dollars the increase in personal income implies $43.1 billion.
Despite the relative good figures in personal income and spending, Ian Shepherdson, Chief U.S. Economist at High Frequency Economics, Ltd warns against a too enthusiastic analysis over consumption trends: Given the strong core retail sales numbers and the surge in energy prices, the consensus forecasts for both nominal and real spending were bafflingly low; you should now expect a wave of modest GDP forecast upgrades for Q4. This does not mean, though, that all is well with the consumer. Nov spending was supported by the very early Thanksgiving, and the recent plunge in confidence is yet to feed through. Expect weaker Dec; Q4 consumption 2-1/2%.
On yearly basis the price index of the personal consumption expenditures excluding food and energy rose by 2.2% in November after posting a revised 2.0% increase in October. The initial estimation for growth was 1.9% in October. The price index registered a monthly increase by 0.2% in November and October.