October 2nd, 2013 4:08 PM by Nick Rapplean
Americans earning more with personal incomes are seeing their biggest gain since February, according to data released last week by the Bureau of Economic Analysis. Personal income grew by $57.2 billion, or 0.4 percent, over July and disposable personal income (DPI) increased $56.2 billion, or 0.5 percent, in August, the bureau reported. Americans were also spending more, with personal consumption expenditures (PCE) in August gaining $34.5 billion, or 0.3 percent over July. Personal outlays — which combine PCE, personal interest payments and personal current transfer payments — grew by $38.4 billion in August. Looking at incomes in detail, private wages and salaries grew by $28.5 billion during August and supplements to wages and salaries improved by $3.8 billion during the month. Meanwhile, personal saving — DPI less personal outlays — hit $580.7 billion in August, and the personal saving rate — personal saving as a percentage of disposable personal income — grew slightly to 4.6 percent in August, up from July’s 4.5 percent. New real estate sales grew in August after a drop in July, with sales of new single-family homes hitting an annual rate of 421,000 for the month, the Census Bureau reported last week. Augusts’ sales marked a 7.9 percent gain over July’s revised rate of 390,000 and a 12.6 percent increase from August 2012’s estimated rate of 374,000. In terms of price, Augusts’ median sales price for new homes rang in at $254,600 and the average sales price was $318,900. In terms of inventory, the estimation of new homes for sale at the end of the month was 175,000, representing a five-month supply at Augusts’ sales rate. Turning to employment news, first-time claims for unemployment insurance filed during the week ending Sept. 21 notched down to 305,000, a decline of 5,000 from the prior week's revised figure of 310,000, the Employment and Training Administration reported last week. The four-week moving average dropped to 308,000, a decrease of 7,000 from the preceding week's revised average of 315,000. The total number of unemployed Americans covered by insurance for the week ending Sept. 14 grew to 2,823,000, an increase of 35,000 from the previous week's revised level of 2,788,000, the Administration also reported. That said, the four-week moving average was 2,842,500, a decline of 42,750 from the prior week's revised average of 2,885,250. But despite the relative good news, Americans were feeling some trepidation about the economy, which many experts chalked up to fears over last week’s Congressional debates about the budget. The University of Michigan/Thomson-Reuters Survey of Consumers reported that of consumer sentiment for September dropped to 77.5 from Augusts’ 82.1. It was the second straight decline after confidence reached a six-year high of 85.1 in July. Similarly, The Conference Board’s Consumer Confidence Index dipped to 79.7 in September from 81.8 in August (a baseline of 100 was set in 1985). In terms of how consumers felt about their current economic circumstances, reports were mixed with the Conference Board’s Present Situation Index grew to 73.2 in September from 70.9, but the Survey of Consumers’ Current Conditions Index dipped to 92.6 in September from 95.2 in August. Both reports agreed about how consumers felt in regards to the economy’s prospects in the near future: The Conference Board’s Expectations Index fell to 84.1 in September from 89 in August. The Survey of Consumers Expectations Index fell to 67.8 in September, down from 73.7 in August.