Traders work on the floor of the New York Stock Exchange on Wall Street on Feb. 20, in New York City. The personal incomes of American workers fell by $18.2 billion in February as inflation maintained a seasonally adjusted rate of 3%, the U.S. Bureau of Economic Analysis reported Thursday. File Photo by John Angelillo/UPI | License Photo
Personal incomes in the United States fell by $18.2 billion in February as inflation maintained a seasonally adjusted rate of 3%, the U.S. Bureau of Economic Analysis reported Thursday.
The decrease in personal income is about a 0.1% drop in spending power. Disposable income also fell at the same rate.
Thursday’s report was delayed more than a week due to the 43-day government shutdown in October and November.
The BEA noted that the decrease in personal income reflects “decreases in personal dividend income and personal current transfer receipts.” This means people received less money from investments and benefits packages in February.
People also spent $106.5 billion more on interest and transfer payments.
The personal consumption expenditures price index is a key measure used by the Federal Reserve to determine monetary policy. The Fed is eyeing the goal of a 2% annual inflation rate.
February’s 3% index excludes volatile food and energy. The all-items inflation rate for the month was 2.8%.
While inflation remained elevated, consumer spending ticked down by 0.1%. Personal consumption expenditures, the measure of spending on goods and services, increased by 0.5% or $103.2 billion.
The U.S. Department of Commerce has revised its gross domestic product figures for the fourth quarter of 2025 down. It previously reported GDP rose at a rate of 0.7% but revised that number to 0.5%.
February’s PCE report is the last to cover the period before the United States entered the war with Iran.
This week in Washington
Secretary of Defense Pete Hegseth speaks during a press briefing at the Pentagon on Wednesday. Yesterday, the United States and Iran agreed to a two-week ceasefire, with the U.S. suspending bombing in Iran for two weeks if the country reopens the Straight of Hormuz. Photo by Bonnie Cash/UPI | License Photo
