The BEA's Personal Income and Outlays April 2019 report looks pretty good on the surface, but not so hot when one dives in on the details.

  • Personal income increased $92.8 billion (0.5 percent) in April according to estimates released today by the Bureau of Economic Analysis.
  • Disposable personal income (DPI) increased $69.3 billion (0.4 percent) and personal consumption expenditures (PCE) increased $40.8 billion (0.3 percent).
  • Real DPI increased 0.1 percent in April and Real PCE decreased less than 0.1 percent.
  • The PCE price index increased 0.3 percent. Excluding food and energy, the PCE price index increased 0.2 percent.
  • The increase in personal income in April primarily reflected increases in personal interest income, wages and salaries, and government social benefits to persons.
  • The $3.7 billion decrease in real PCE in April reflected a decrease of $5.4 billion in spending for services that was partly offset by a $2.4 billion increase in spending for goods. Within services, the largest contributor to the decrease was spending for household electricity and gas. Within goods, spending for gasoline and other energy goods was the leading contributor to the increase.

The nominal numbers look good but it's real income and spending that drive GDP.

Mike "Mish" Shedlock

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