Updated: 31-Jul-20 10:01 ET
| June Personal Income and Spending |
 |
|
| Updated: 31-Jul-20 10:01 ET |
Highlights
- Personal income declined 1.1% m/m in June (Briefing.com consensus -0.9%) following a downwardly revised 4.4% decline (from -4.2%) in May.
- Personal spending increased 5.6% m/m (Briefing.com consensus 5.9%) on the heels of an upwardly revised 8.5% increase (from 8.2%) in May.
- The PCE Price Index rose 0.4% m/m, as expected, while the core-PCE Price Index, which excludes food and energy, jumped 0.2% m/m, which was also in-line with expectations. On a yr/yr basis, the PCE Price Index was up 0.8%, versus 0.5% in May, and the core-PCE Price Index was up 0.9%, versus 1.0% in May.
Key Factors
- Real disposable personal income declined 1.8% m/m and was up 8.1% yr/yr.
- Real personal consumption expenditures increased 5.2% m/m and were down 5.5% yr/yr.
- The personal savings rate, as a percentage of disposable personal income, fell to 19.0% from 24.2% in May.
Big Picture
- The key takeaway from the report is that a 2.2% m/m gain in wages and salaries as the economy reopened was not enough to offset the 8.9% m/m decline in personal current transfer receipts. This consideration highlights the risk to the recovery trajectory that would be exacerbated at this juncture without further government assistance.
| Category | JUN | MAY | APR | MAR | FEB |
| Personal Income | |||||
| Total Income | -1.1% | -4.4% | 12.1% | -1.8% | 0.8% |
| Wage and Salary | 2.2% | 2.6% | -7.8% | -3.1% | 1.0% |
| Disposable Income | -1.4% | -5.1% | 14.7% | -1.8% | 0.7% |
| Savings Rate | 19.0% | 24.2% | 33.5% | 12.8% | 8.3% |
| Personal Consumption | |||||
| Total (Nominal) | 5.6% | 8.5% | -12.9% | -6.7% | 0.0% |
| Total (Real, Chain $) | 5.2% | 8.3% | -12.4% | -6.5% | -0.1% |
| Core PCE Deflator | |||||
| Month/Month | 0.2% | 0.2% | -0.4% | -0.1% | 0.2% |
| Year/Year | 0.9% | 1.0% | 0.9% | 1.7% | 1.9% |