**MNI 5 THINGS: US Sept Core PCE Price Index +0.2%; Y/Y +2.0%>

--5 Things We Learned From September Personal Income Data         

By Kevin Kastner, Harrison Clarke, and Shikha Dave

     WASHINGTON (MNI) - The following are the key points from the 

September personal income, spending, and price data released Monday by 

the Bureau of Economic Analysis: 

     - The data suggest inflation is well contained, with the year/year 

rate for the core measure continuing its string of 2.0% gains and the 

overall PCE price index falling to +2.0% y/y from +2.2% in August. 

Personal income growth was below expectations, while nominal PCE and 

month/month core prices were as-expected, so markets are likely to shrug 

off the data. 

     - The core PCE price index rose 0.2% m/m (+0.153% unrounded, so 

almost +0.1%), as expected, following a flat (+0.035%) reading in 

August. The y/y rate stayed at 2.0% (+1.966% unrounded vs +1.960% in 

August). The overall PCE price index was up 0.1% m/m for the fourth 

straight month, compared with a 0.3% gain a year ago, allowing the y/y 

rate to slow to 2.0% from 2.2% in August. 

     - Current dollar PCE was up 0.4%, right on expectations, with a 

1.4% surge durable goods spending, likely on vehicles, driving much of 

the increase. Nondurable goods spending and services spending were both 

up 0.3% in the month. Real PCE was 0.3% after a 0.4% gain in August. 

     - Personal income was up only 0.2%, below the 0.4% gain expected, 

with wages and salaries up only 0.2%. Additionally, proprietors' income 

posted the first outright decline since April. Offsetting that weakness 

were strong gains for rental income, receipts on assets, and current 

transfer receipts. 

     - Personal taxes were up 0.3% after a 0.6% gain in August. 

Disposable personal income was up 0.2% while real disposable income was 

up 0.1%. The savings rate fell to 6.2% from 6.4% in August. 

     ** MNI Washington Bureau: 202-371-2121 ** 

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