REPEAT:MNI DATA ANALYSIS:US Oct Core PCE Prices Now +1.8% Y/Y>

Repeats Story Initially Transmitted at 13:30 GMT Nov 29

--Initial Claims Up 10k To 234k In Nov 24 Wk, 4-wk Avg Rises To 223k

--Core PCE Prices +0.1% M/M; Overall Prices +0.2% M/M, +2.0% Y/Y

--Nominal PCE +0.6%, Real PCE +0.4%; Personal Income +0.5% 

By Kevin Kastner, Harrison Clarke, and Shikha Dave

     WASHINGTON (MNI) - Nominal PCE rose 0.6% in October, stronger than 

expected, while core PCE prices were up 0.1% for the month, slowing 

the year/year rate to 1.8% after rounding, according to data released by 

the Bureau of Economic Analysis Thursday morning. 

     The 1.8% year/year rate for core PCE prices, the lowest since 

March, follows downward revisions after rounding to the previous two 

months to 1.9%, and results partially from base effects due to a larger 

month/month rise a year earlier. The rate sits moderately below Fed's 

inflation target. 

--PCE GROWTH STRONGER THAN EXPECTED

     The 0.6% gain in current dollar PCE was above the 0.5% median 

expectation in an MNI survey and followed a 0.2% gain in September. 

Spending on durable goods was up 0.5% in the month, while nondurable 

goods spending rose 0.6% on a 2.4% increase in energy prices. Services 

spending was up 0.7%.   

     Real PCE was up 0.4% in October, as the overall PCE price index was 

up 0.2%. The overall PCE price index was up 2.0% year/year, unchanged 

from September, but down from the levels seen in the summer. 

     After inflation adjustment, durable goods PCE was up 0.4%, while 

real nondurable goods PCE was up 0.3% and real services PCE was up 0.5%. 

--INCOME RISES, SAVINGS RATE FALLS SLIGHTLY

     Personal income rose by 0.5%, larger than the 0.4% gain expected, 

on an increase in wages and salaries as well as solid gains in 

proprietors' income, return on assets, and current transfer receipts. 

     The saving rate fell in October to 6.2% from 6.3% in September. 

     Personal taxes rose by 0.2% in the month after a 0.4% increase in 

September. As a result, disposable personal income rose by 0.5% after a 

0.2% increase in September, while real disposable income was up 0.3%.

--JOBLESS CLAIMS, 4-WK AVG RISE         

     Also released on Thursday, initial jobless claims were up 10,000 to 

234,000 in the November 24 holiday week, well above the 220,000 level 

expected. The 4-week moving average was up 4,750 to 223,250. The 

average would rise in the December 1 week as the 214,000 level in the 

November 3 week rolls out of the equation, assuming no change to the 

headline figure next week. 

     Continuing claims rose by 50,000 to 1.710 million in the November 

17 employment survey week, up 72,000 from the 1.638 million level in 

the October 13 employment survey week. The 4-wk moving average for 

continuing claims was up 19,750 to 1.668 million. 

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