MetroIntelligence Economic Update by P. DUFFY
Inflation tracker PCE Price Index up 0.6 percent in January and 6.1 percent year-on-year
The Fed-preferred PCE index rose 0.6% in January, up from 0.5% in December but matching the same level in November and October. The ‘core’ index subtracting out food and energy costs rose 0.5% in January, matching the level of previous three months. Year-over-year, the index rose 6.1%, the highest annual hike since 1982. The ‘core’ index rose 5.2% year-over-year, the highest annual hike since 1983.
Personal spending jumps 2.1 percent in January, far outpacing income gains
In January, personal income increased less than 0.1 percent, disposable person income rose 0.1 percent and personal consumption expenditures (PCE) increased 2.1 percent. This jump in spending led to a decline in the personal saving rate to 6.4 percent, the lowest level since December 2013.
Pending home sales fall 5.7 percent in January and 9.5 percent year-on-year
Pending home sales slumped 5.7 percent in January, continuing what is now a three-month drop in transactions. Of the four major U.S. regions, only the West registered an increase in month-over-month contract activity. All four regions posted a decline in year-over-year activity, with national pending sales falling 9.5 percent.