(Click on image to enlarge)

Real PCE (inflation-adjusted Personal Consumption Expenditures) was up 0.3 percent in August. Real disposable personal income was up 0.1 percent.

The NBER, the official arbiter of recessions, tracks real personal income excluding transfers. Real PI excluding PCTR was flat in August.

PCTR stands for Personal Current Transfer Receipts, income for which no current services were performed. Example include Medicare, Medicaid, food stamps, and Social security benefits.

Personal Income and Real Personal Income Percent Change from Month Ago

(Click on image to enlarge)

Personal Income Details

• Personal Income: 0.4 percent
• Real Disposable Personal Income: 0.1 percent
• Real Personal Income Excluding Transfers: 0.0 percent.

Disposable means after taxes.

Personal Income and Real Personal Income Billions

(Click on image to enlarge)

The above chart shows three huge spikes in personal income. These were free money transfers in the covid pandemic.

The Fed did not foresee this free money would cause inflation.

The dashed lines are nominal income. The solid lines adjust for inflation.

PCE Percent Change from Month Ago

(Click on image to enlarge)

PCE Percent Change Details

• Nominal PCE: 0.6 percent
• Real PCE: 0.3 percent
• Real PCE Goods: 0.7 percent
• Real PCE Services: 0.2 percent

Services account for more spending which is why PCE goods did not have a huge impact.

Tariffs are likely having an impact on goods causing a consumer shift in that direction.

Related Posts

September 25,2025: Real Second-Quarter GDP Revised Higher to 3.8 Percent

The BEA revised second-quarter GDP from 3.3 percent to 3.8 percent.

September 25,2025: Existing-Home Sales Drop Slightly, Stagnant for Almost Three Years

Sales are down 0.2 percent on the month and nowhere for years.

September 25, 2025: Small Businesses Keep Getting Smaller in Big Wave of Downsizing

The latest quarterly employment report shows a wave of corporate downsizings.

More By This Author: