Analysts expected the trend of the last two months to continue in July with personal spending rebounding (though at a slower pace) and personal incomes shrinking back, but both surprised to the upside with a +0.4% MoM rise in incomes and +1.9% MoM jump in spending ( vs -0.2% and +1.6% respectively).
Sending the savings rate lower (from 19.2% to 17.8%)…
Finally we note that The Fed’s favorite inflation indicator – Core PCE Deflator – re-accelerated in July, but at 1.3% remains well below any old or new mandate-driven level…
Bear in mind that this data – from July – was before the big handouts all stopped!
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