Personal Income and Disposable Income Decline While Personal Consumption Expenditures Rise in May

The U.S. Bureau of Economic Analysis (BEA) reported on Friday (6-25-21) that according to their estimates, Personal Income decreased -$414.3 billion or -2.0% in May 2021. Disposable personal income (DPI) decreased -$436.3 billion or -2.3% and personal consumption expenditures (PCE) increased $2.9 billion, or less than 0.1%. Real DPI decreased -2.8% in May and Real PCE decreased -0.4%; goods decreased -2.0%, while services increased 0.4%. The PCE price index increased 0.4%. Excluding food and energy, the PCE price index increased 0.5%. The BEA estimate for May personal income and outlays reflected the continued economic recovery, reopening of establishments, and continued government response related to the COVID-19 pandemic. The decrease in personal income for May reflected declines in pandemic-related assistance programs. The full economic effects of the COVID-19 pandemic cannot be quantified in the personal income and outlays estimate because the impacts are generally embedded in source data and cannot be separately identified.