US DATA: May Pers Income +0.2%, PCE flat, Core PCE prices +0.1% for
+1.8% YOY, pretty much as expected. Pvt wages +$1.1b vs +$5.3b in Apr as
goods-producing payrolls fell; there has been a slowing in wages
recently that helps explain slower spending (even though lower inflation
bulked up real disposable pers income to +0.3%, its best gain since May
’10). Income supplements, rents, proprietors’ income, transfers and
income receipts all gained. Real PCE pattern is +0.1% for both Apr and
May and this means Q2 is seeing slow real growth in the +1.5% area. May
savings rose, putting the saving rate at 3.9% vs 3.7% in Apr. Bottom
line – pretty much as expected, nothing unusual given that we already
knew retail sales were weak and vehicle purchases slowed.
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