THE BASIS POINT

Income Up. Spending & Inflation Flat.

Rates are retaining lows this morning as mortgage bonds and Treasuries rally on no resolution for Greek debt crisis (details). Below is a roundup of today’s stats.

Personal Income & Expenses (December 2011)
-Personal Income, Month/Month change +0.5 %. Previous was +0.1%. Consensus was +0.4%.
-Personal Income, Year/Year +3.8%
-Consumer Spending, Month/Month 0.0%
-Consumer Spending, Year/Year +3.9%
-Consumers must be replacing their savings which fell from 5.7% to 3.7% over the past 5 quarters. The depletion is savings was part of what was contributing to GDP growth. This is another indication of flattening in GDP.

Personal Consumption Expenditures Index: Consumer Inflation (December 2011)
-PCE All, Month/Month +0.1%
-PCE Core (excluding food & energy), Month/Month +0.2%
-PCE All, Year/Year +2.4%
-PCE Core (excluding food & energy), Year/Year +1.8%
-This is Fed’s preferred consumer inflation measure, and it continues to be flat

Dallas Federal Reserve Manufacturing Survey
-General Business Index 15.3. Previous was -1.3. Consensus was 1.0.
-Production Index 5.8. Previous was 0.2.
Full report
-We may be seeing another case of business getting ahead of the consumer