August 28, 2020
In July, personal income rose $70.5 billion (0.4%) in the U.S, according to estimates released by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $39.9 billion (0.2%) and personal consumption expenditures (PCE) rose $267.6 billion (1.9%).
Real DPI declined 0.1% in July, and Real PCE rose 1.6%. The PCE price index climbed 0.3%. The PCE price index less food and energy rose 0.3%.
According to BEA, the rise in personal income in July was primarily attributed to the “compensation of employees as portions of the economy continued to reopen,” as well as “proprietors’ income and rental income of persons.” Moreover, these increases were tempered by decreases in government social benefits and income on assets. Unemployment insurance benefits, based primarily on unemployment claims data from the Department of Labor’s Employment and Training Administration, also decreased in July.
In July, the real PCE rose by $200.6 billion, revealing an $82.1 billion increase in spending for goods and a $121.2 billion increase in spending on services. Within goods, spending on new motor vehicles was the main contributor to the rise. Within services, the leading contributors to the increase were spending on health care as well as food services and accommodations.
Personal outlays rose $270.6 billion in July while personal saving was $3.19 trillion, and the personal saving rate, personal saving as a percentage of disposable personal income, stood at 17.8%.
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