January 30, 2013
Personal Spending: December 2012 Preview
Personal consumption spending in December is expected to rise 0.3% on a seasonally adjusted monthly basis in nominal terms, according to The Capital Spectator's average econometric forecast.That compares with a 0.4% gain in the previous report. The average projection for December is roughly in line with several consensus forecasts based on surveys of economists.
Here's a closer look at the numbers, followed by brief summaries of the methodologies behind The Capital Spectator's projections:
VAR-3: A vector autoregression model that analyzes three economic time series in context with personal consumption expenditures. The three additional series: US private payrolls, personal income, and industrial production. The forecasts are run in R with the "vars" package.
R-1: A linear regression model that analyzes the historical record of personal consumption expenditures in context with retail sales. The historical relationship between the variables is applied to the more recently updated retail sales data to project personal consumption expenditures. The computations are run in R.
Posted by jp at January 30, 2013 8:24 PM