U.S. consumer spending climbed 5.6% in June, following a record-setting 8.5% jump in May as businesses reopened. The gain was a bit higher than the 5.5% advance economists surveyed by Reuters expected. Consumers increased spending on clothing, footware, healthcare, dining out and on hotel/motel expenses last month. But another spike in Covid-19 has since caused some states to halt reopening efforts this month.
Personal income fell 1.1% in June after sliding 4.4% in May. The savings rate edged down from 24.2% in May to 19.0% in June, which is still a historically high level. Inflation picked up amid gains for food, energy goods and services, but inflation still remains muted.
Also of note, tech giants Apple, Amazon.com and Facebook also reported far stronger quarterly earnings than anticipated. But yesterday’s historically bad second quarter GDP figure overshadowed today’s positive data, causing equities to soften on the last trading day of the week and month. The end of the $600 supplemental unemployment benefit likely added to negative attitudes.