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Sluggish Consumption As Savings Rate At New Post-2009 Low

US DATA
  • Along with the surprisingly soft headline and core PCE inflation prints, real personal spending disappointed in July as it increased just 0.2% M/M (cons 0.4%) after 0.1% M/M.
  • Continuing a string of subdued monthly prints, real spending has started Q3 on a soft note, increasing just 1% on a 3M/3M annualised basis following the 1.5% in Q2.
  • Back in nominal terms, similarly sized disappointments for both income and spending meant relatively little change for the personal savings rate, although a tenth downward revision to 5.0% leaves it at a fresh low since Aug’09 as the pace in the reduction of savings begins to restrain growth.

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