by Calculated Risk on 9/29/2014 12:31:00 PM

The BEA released the Personal Income and Outlays report for August this morning:

Personal income increased $47.3 billion, or 0.3 percent ... in August, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $57.5 billion, or 0.5 percent.
...
Real PCE -- PCE adjusted to remove price changes -- increased 0.5 percent in August, in contrast to a decrease of 0.1 percent in July. ... The price index for PCE decreased less than 0.1 percent in August, in contrast to an increase of 0.1 percent in July. The PCE price index, excluding food and energy, increased 0.1 percent, the same increase as in July. ... The August price index for PCE increased 1.5 percent from August a year ago. The August PCE price index, excluding food and energy, increased 1.5 percent from August a year ago.

The following graph shows real Personal Consumption Expenditures (PCE) through August 2014 (2009 dollars). Note that the y-axis doesn't start at zero to better show the change.

Click on graph for larger image.

The dashed red lines are the quarterly levels for real PCE.

Using the two-month method to estimate Q3 PCE growth, PCE was increasing at a 2.0% annual rate in Q3 2014 (using the mid-month method, PCE was increasing 2.9%). It looks like another quarter of modest PCE growth.

On inflation: The PCE price index increased 1.5 percent year-over-year, and core PCE price index (excluding food and energy) increased 1.5 percent year-over-year in August.