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Personal Income And Outlays Definition

What Is Physical Income and Outlays?

The Personal Income and Outlays report (also called the Personal Consumption Report) consists of a series of details groupings produced by the Bureau of Economic Analysis (BEA) that track consumer income and spending. Personal income is the dollar value of receipts from all sources by individuals in the U.S.; personal outlay is the dollar value of purchases of durable (consumer goods that are not purchased habitually), and non-durable goods and services by U.S. consumers. These data can give indications of consumer behavior, saving activity, and comprehensive economic performance.

Key Takeaways

  • Personal Income and Outlays is a monthly report issued by the Bureau of Economic Analysis, which depicts consumer rating, spending, and saving. 
  • Because consumer spending is an important indicator of the demand for businesses’ products and represents a large portion of the U.S.’ gross domestic product (GDP), the Personal Income and Outlays report is closely watched. 
  • Changes in the amounts and ratios between takings, spending, and saving can provide important indications of current and near-term future economic trends. 

Understanding Personal Receipts And Outlays

The serious components of the BEA’s Personal Income and Outlays report are personal income, disposable personal income (income after strains), and personal consumption expenditures. The difference between income and expenditures can be interpreted as a consumers’ gross savings, which can be kept as cash or invested. BEA also releases data which breaks these categories down even further into a variety of types of income, such as wages, salaries, interest received, and veterans’ benefits. Personal consumption expenditure figures is available for a vast array of various types of products and services of different types. All data sets are reported in in the know dollars and real (inflation-adjusted) dollars. 

As income and spending increases, it is thought that equity markets should retaliate positively because of an assumed resulting increase in corporate profits as consumer spending filters through the economy. In any way, increased consumer demand is also believed to lead to wage and price inflation, which could have a annulling effect on bond markets. A larger-than-expected monthly increase in income and outlay can cause bond prices to drop—and give ins and interest rates to rise—based on inflation expectations and investor concern that the Federal Reserve will tighten pecuniary policy in response.

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