PERSONAL INCOME AND SPENDING

Definition

The successful forex broker or trader will use many tools in order to make decisions about their investments. One of those tools is the Personal Income and Spending report, also known as the Personal Income and Consumption report.

Income is tracked using employment reports and payroll files in this report. Interest payments, rental income, dividend income, and income from other non-payroll sources are also included. Figures are given in billions of dollars and in percentage changed from previous reports. The second half also provides information about consumer spending in consumables, non-consumables, and services.

FX Trading Importance

The first half of the report is seen as an FX trading indicator of potential demand for products and spending in various industries. Individuals involved with forex trading can use this as a tool for analyzing the market. However, the report cannot determine whether or not consumers are going to spend or save any increased income, so it is not something that is purely black and white—though nothing in the world of forex trading tends to be.

The report’s second half is considered to be more useful for deciding which industries have the potential for growth. However, forex brokers and financial experts generally consider this report to have less importance than the Census Bureau’s Retail Sales report for determining future industry growth.