Biggest Drop In Personal Income Since Feb 2010 Can't Stop Borrowers Spending, While Savings Rate Plunges
US personal income fell 0.1% MoM - missing the +0.3% expectations by the most since September 2011 - but that didn't stop spending which modestly beat expectations at +0.3%. The drop in incomes is the largest (absent the 2012 year-end debacle) since February 2010. Given the disparity, it is hardly surprising that the savigs rate dropped to its lowest since June. So unsaving is the route to freedom once again as borrowing helps drive durable good spending up 0.77%
As a result, and as expected, the personal savings rate plunged from 5.2% to 4.8%.
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