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Personal Savings Ratio Dips Close To Pre-2008 Lows

US DATA
  • The combination of personal incomes in line with expectations (0.4% M/M) but spending stronger (0.6% M/M with upward revision) came as the savings rate fell 0.3pts to 3.1%.
  • It drops back close to the low of 3.0% in June and is just off pre-2008 lows of 2.8% which on that basis alone implies it might struggle to be run much lower, removing a past driver of consumption.
  • The petering out in recent months coincides with real personal spending also fading, running at 1.5-2% annualized across different trend rates.

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