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US Personal income decreased 2.0% month-over-month in May. The fall was driven by an 11.8% decline in government social benefits. The Core-PCE Price Index, which excludes food and energy, rose 0.5% and was up 3.4% year-over-year (versus 3.1% in April).

US Miss

The market continues to hit new highs in the stock markets and long-term bond yields barely moved. The market is trading on the premise that the US is at or close to, peak inflation. The shock will come if better inflation news in coming months is not coming.

Highlights

  • Personal income decreased 2.0% month-over-month in May. The fall was driven by an 11.8% decline in government social benefits.
  • Personal spending was unchanged v consensus +0.3%following an upwardly revised 0.9% increase (from +0.5%) in April.

  • The PCE Price Index jumped 0.4% month-over-month and was up 3.9% year-over-year (versus 3.6% in April).

  • The core-PCE Price Index, which excludes food and energy, rose 0.5% and was up 3.4% year-over-year (versus 3.1% in April).

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  • Real personal spending decreased 0.4% month-over-month but was up 14.5% year-over-year.

  • Real disposable personal income declined 2.8% month-over-month and was down 2.3% year-over-year.
  • The compensation of employees increased 0.7% month-over-month, paced by a 0.8% increase in wages and salaries.
  • The personal savings rate, as a percentage of disposable personal income, slipped to 12.4% from 14.5%.'' less than a consensus -2.5%,

From The TradersCommunity News Desk

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