Following this week’s GDP revisions, Americans’ spending was expected to reaccelerate (after slowing for 3 straight months) and incomes are expected to see growth moderate, and that is exactly what happened.
Personal Spending jumped 0.6% MoM in July (the best since April) but Personal Income rose just 0.1% MoM (well below expectations and the slowest since Sept 2018)
Source: Bloomberg
On a year-over-year basis, spending accelerated to +4.1% while income growth slowed notably to +4.6%.
Source: Bloomberg
Which means that the savings rate slumped from 8.0% to 7.7% (but remember this datya series was dramatically revised higher)…
And finally, The Fed’s preferred inflation indicator (Core PCE) remains below their mandated 2.00% level…
Source: Bloomberg
Get back to work Mr.Powell!
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