Percent Change from Preceding Month
Personal income increased moderately in February by 0.3 percent, down from January's spike of 1.2 percent caused by the reduction in employee contributions to social security that kicked in at the beginning of 2011. Personal consumption expenditures rose by a strong 0.7 percent in February, paced by spending on durable goods. On a year-over-year basis, income and consumption increased by 5.1 and 4.1 percent, respectively. While these are good numbers, they are tempered by the recent rise in energy prices, which are becoming a drag on consumer spending. Economists who raised their GDP forecasts late in 2010 are now lowering them. The chances of a recession this year are remote, but slower economic growth may impinge upon the rate of recovery in the commercial real estate leasing markets.