US personal income, spending increase in August

ANKARA

Personal income in the US rose slightly in August coming below market estimates, but personal spending showed a strong increase beating expectations, according to data released by the Bureau of Economic Analysis on Friday.

In August, personal income increased $35.5 billion, or 0.2%, from the previous month, while personal spending jumped $130.5 billion, or 0.8%.

Market expectation for personal income was an increase of 0.3% in August, while it soared 1.1% in July. Market estimate for personal spending was an increase of 0.6% in August, while it fell 0.1% in July.

The personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation indicator, increased 0.4% in August. Core PCE index, excluding food and energy, rose 0.3% from the previous month. Year-on-year, they were up 4.3% and 3.6%, respectively.

The Fed has repeatedly said in recent months it will allow inflation to climb slightly above its 2% target to revive American economy from the pandemic until raising interest rates, but inflation has soared recently.

The consumer price index (CPI) in the US rose 5.3% in August on an annual basis, after climbing 5.4% in June and July. The producer price index (PPI) soared 8.3% in August annually, after jumping 7.8% in July, according to the latest figures from the US Labor Department.