Consumers Keep Saving - Update
Personal saving among US consumers significantly outpaced increases in income for the third straight month in June 2010, while spending slightly declined, according to the monthly Personal Income and Outlays report from the Bureau of Economic Analysis (BEA).
Consumers Stabilize Saving
In June 2010, consumers saved $725.9 billion, 1.7% more than a revised $713.9 billion saved in May 2010. Personal saving as a percentage of disposable personal income was 6.4% in June, compared with 6.3% in May.
Personal saving went through numerous radical monthly shifts in 2009 and then declined for the first three months of 2010 before reversing course with a dramatic 16.2% increase in April 2010.
Income Continues Minimal Growth
In June 2010, US consumers’ personal income increased $3 billion, or less than 0.1%, and disposable personal income (DPI),which is personal income less current personal taxes increased $5.1 billion, also equaling less than 0.1% growth.
This fractional growth in income continues an established trend as in May 2010, personal income increased $40.5 billion, or 0.3%, and DPI increased $36.9 billion, or 0.3%. In April 2010, personal income increased $59.4 billion, or 0.5%, and DPI increased $63.7 billion, or 0.6%. In March 2010, personal income grew $46.7 billion, or 0.4%. Disposable personal income (DPI) increased $57.6 billion, or 0.5%.
Spending Slips Slightly
U.S. consumers’ personal consumption expenditures (PCE), which essentially reflect consumer spending, declined $2.9 billion, or less than 0.1%, in June 2010. In May 2010, PCE increased $24.4 billion, or 0.1%. PCE has fluctuated more than personal income and DPI in recent months, dropping 0.1% in April but rising 0.5% in March.
Monthly Retail Sales Fall, Annual Retail Sales Rise
According to the June 2010 Advance Monthly Retail Trade Survey from the U.S. Census Bureau, U.S. retail and food service sales fell 0.5% on a monthly basis but rose 4.8% on a yearly basis.
In June 2010, U.S. retail and food service sales totaled $360.2 billion, compared to $362 billion in May 2010 and $343.7 billion in June 2009. On a monthly basis, this is the second straight monthly sales decrease, following a four-month streak of gradually slowing monthly U.S. retail and food service sales increases.