July Personal Income +0.4%; Nom PCE +1.9%; Beats Expectations

Personal income rose 0.4% in July, more than the -0.3% expected, and current dollar personal consumption expenditures also rose more than expected by 1.9% (vs 1.6% expected). June PI was revised a tenth higher to -1.0% and PCE was revised up six-tenths to 6.2%.

• Compensation bolstered PI as parts of the economy continued to reopen, while proprietors' income and rental income also contributed to the increase.
• Offsetting that were decreases in government benefits and income on assets as unemployment insurance benefits fell in the month
• PCE uptick was led by new motor vehicles on the goods side and health care and food and hotels on the services side
• PCE inflation for July was 0.3% and 1.0% yoy; core PCE inflation was 0.3% and 1.3% yoy
• Savings rate continued to be elevated at 17.8%