Americans are saving and earning less. But they won't stop spending.
Neil Irwin
Neil Irwin, author of Axios Macro
Americans saw income growth that slowed to a crawl in July, but their spending rate decidedly did not.
Why it matters: Americans are saving less to continue spending robustly, even as income growth slows — telling us something important about the economic currents that will shape the next year.
If it continues, that dynamic will prevent a recession from taking hold, though at the cost of leaving household balance sheets more fragile.
Driving the news: Personal incomes rose 0.2% in July, the Commerce Department said Thursday. Disposable personal income — what people made after taxes — was flat for the month and down 0.2% after accounting for inflation.
Yet spending still roared ahead, rising a brisk 0.8% (0.6% in inflation-adjusted terms).
more
https://www.axios.com/2023/08/31/personal-income-spending-data