The BEA reports "Real DPI decreased 0.1 percent in August and Real PCE decreased 0.1 percent. The PCE price index increased 0.2 percent. Excluding food and energy, the PCE price index increased 0.1 percent."

Unadjusted, personal income in August rose 0.2% as the Econoday consensus expected, but June and July income were revised lower.

Consumer spending rose a mere 0.1%. Real spending declined.

Economists expected prices to jump 0.3%. Instead, prices rose 0.1%. Core prices rose 0.1% vs an expectation of 0.2%.

The next Federal Reserve rate hike may not be in December after all, based on an unexpectedly weak personal income and spending report that includes very soft inflation readings. Income is the best news in the report as it managed the expected 0.2 percent August gain getting boosts from proprietor income, transfer receipts and also rent. Wages and salaries, in part reflecting a decline in hours, came in unchanged though this follows strong growth in the prior 2 months. Another weakness in today's report is a 1 tenth downward revision to overall July income which now stands at 0.3 percent. The savings rate held unchanged in August at a moderate 3.6 percent.