US: Personal income and spending to post strong numbers – Wells Fargo

Research Team at Wells Fargo Securities, notes that the US consumer spending has strengthened considerably since the start of the year, as evidenced by the 4.2 percent increase in real personal consumption expenditures in the second quarter.

Key Quotes

“We expect the quarter ended on a decent note, with spending up 0.2 percent in June. The recent pickup in spending brings outlays more in line with household income, which has been running around a 4 percent rate over the past year. After increasing 0.2 percent in May, we expect personal income growth strengthened a bit in June following stronger hiring over the month.

The latest readings from the CPI and PPI suggest inflation remained tame over the month. The headline PCE deflator likely rose 0.2 percent last month, while core PCE inflation is expected to rise 0.1 percent.”