What is it and why does it matter?

Real personal consumption expenditures (PCE) is the primary measure of consumer spending on goods and services in the U.S. economy. This chart shows the real (or inflation-adjusted) level of expenditures, broken down by durable goods, nondurable goods, and services. Durable goods have an average useful life of at least 3 years (e.g. motor vehicles) while nondurable goods have an average useful life of less than 3 years (e.g. food). Services are commodities that cannot be stored or inventoried and are consumed at the time of purchase (e.g., dining out). Roughly two-thirds of the total U.S. economic output is through consumer spending.

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