U.S. real PCE likely to push Q3 GDP tracking estimate higher

Preliminary analysis points to a 0.1% decline in the U.S. PCE chain price index during the reference period. As a result, real PCE likely rose by 0.5% last month - the largest one-month gain since May. Assuming no prior-month revisions, that forecast would place inflation-adjusted spending over the July-September period a hefty 3.9% annualized above the April-June average. 

"Perhaps even more important, our projection would place September's outlays 1.8% above the implied Q3 average, implying considerable momentum in consumer spending heading into the final stanza of 2015. Together with the constant-dollar merchandise trade figures for August released last week, the updated real PCE estimate places our Q3 real GDP tracking estimate at 2.4%", says Societe Generale.