Dan Green

Dan Green

Since 2003, Dan Green has been a leading mortgage lender and respected industry authority. His unwavering commitment to first-time home buyers and home buyer education has established him as a trusted voice among his colleagues, his peers, and the media. Dan founded Homebuyer.com to expand the American Dream of Homeownership to all who want it. .

Fairfield Home - Personal Consumption Expenditures

How We Make Money

Homebuyer.com is your trusted guide to homeownership. Since 2003, our team has offered real-world expertise and advice to tens of millions of U.S. home buyers. Our content stands on its integrity: it's factual, unbiased, and free from outside influences. Read more about our governing editorial guidelines.

We also exist for profit and want our readers to understand how we make money.


Homebuyer.com is a mortgage-company-affiliated publisher. We earn compensation when you click specific links on the website, or apply for a mortgage with Homebuyer.com or partner listed in our comparison tables. Our partners compensate us differently, so we randomize our tables to protect our readers from steering. We may also earn compensation for advertisements on the site, which are indicated clearly. Note that limitations in our software, whether we originate mortgages in your area, and credit factors may affect the offers and comparison tables you see on various parts of this site. We do not include offers for every mortgage product available. Someday, we hope we will.

Certified Accurate

Certified Accurate

Your trust matters to us. This article was thoroughly checked for accuracy as of January 21, 2024. Homebuyer.com ensures every piece of information we share reflects the latest in mortgage standards. Learn more about our commitments to our reader in our editorial guidelines.

What is Personal Consumption Expenditures?

Personal Consumption Expenditures (PCE) is an economic indicator representing the value of household goods and services consumed.

Personal Consumption Expenditures: A Detailed Explanation

Personal Consumption Expenditures (PCE) measure the total amount individuals and households spend on goods and services. The PCE describes consumer spending habits, which is a significant component of overall U.S. economic activity.

The Bureau of Economic Analysis (BEA) collects and publishes Personal Consumption Expenditures data. PCE is a critical component of the Gross Domestic Product (GDP) calculations, representing the largest share of GDP. Policymakers and economists often use PCE to gauge the economy’s health, as changes in consumer spending can reflect broader economic trends.

The Federal Reserve relies on PCE to measure inflation, which influences mortgage rates.

How is Personal Consumption Expenditures Calculated?

PCE is calculated by summing expenditures on durable goods, nondurable goods, and services by households and nonprofit institutions serving households. Data is gathered from various sources, including business surveys and government reports, and adjusted for inflation. This adjustment allows for a more accurate comparison over time by accounting for changes in the prices of goods and services.

Personal Consumption Expenditures: Chart

Homebuyer.com uses the FRED® API but is not endorsed or certified by the Federal Reserve Bank of St. Louis.
Data: Bureau of Economic Analysis. Do not reprint without permission.

Common Questions About Personal Consumption Expenditures

How does Personal Consumption Expenditures differ from other consumer spending measures?

PCE differs from other consumer spending measures in its scope. Compared to Retail Sales, which focuses strictly on the sale of goods, PCE includes spending on goods and services. Additionally, PCE is adjusted for inflation and changes in consumer behavior over time, making it a more comprehensive measure.

Why is Personal Consumption Expenditures important to housing?

PCE is important because consumer spending drives most U.S. economic activity. Fluctuations in PCE may indicate changes in consumer confidence and economic health. PCE is a key indicator for policymakers and economists.

How does PCE impact monetary policy?

The Federal Reserve closely monitors PCE, particularly the PCE Price Index, which measures inflation. Changes in PCE can influence interest rates and other policy measures. A high PCE may prompt the Fed to raise the Fed Funds Rate to control inflation, while a low PCE could lead to lower interest rates to stimulate spending.


       Personal Consumption Expenditures (PCE) is an economic indicator representing the value of household goods and services consumed.

Subscribe to our Newsletter

Be a better buyer. Subscribe now and never miss out on exclusive insights, new market trends, and first-time buyer programs.

Ready to get started?

Finding your dream starts here. Apply in minutes.

Get Pre-approved
© 2021-2024 All rights reserved. Growella Inc d/b/a Homebuyer. Homebuyer.com is powered by Novus Home Mortgage, a division of Ixonia Bank, NMLS 423065. www.nmlsconsumeraccess.org Homebuyer is located at 230 Findlay Street, Cincinnati, Ohio 45214. Novus Home Mortgage, a division of Ixonia Bank, is located at 20225 Water Tower Blvd. Suite 400, Brookfield, WI 53045. We have no affiliation with the US Department of Housing and Urban Development, the US Department of Veterans Affairs, the US Department of Agriculture, or any other government agency. US Government agencies have not reviewed this information and this site is not connected with any government agency. Equal Housing Lender. Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. The receipt of the application does not represent an approval for financing or interest rate guarantee. Restrictions may apply.
Get Today's Mortgage Rates »