After 6 straight months of decline in annual spending growth, May saw YoY spending pop 3.6% (the most since Dec 2014). After an unchanged April, May expectations for spending were a 0.7% jump but the data blew that away, printing a 0.9% MoM jump – the biggest since August 2009 and biggest beat since Jan 2013. Personal Income only grew at 0.5% (still the highest MoM jump since March 2014) driving the savings rate down to 5.1% – the lowest since December. Before Steve Liesman and his buddies get too excited – spending was driven mainly by a 4.72% surge in spending on Energy goods & services – not exactly what the discretionary buying consumer-oriented society that is required to keep the dream alive was looking for. Finally we note non-durable spending topped durables and this exuberant GDP-boosting spendfest (un-save-fest) provides more ammo for an earlier Fed rate hike.
Spending Spike…
But all of the gains went to energy costs… Spending Ex-Energy is the lowest since March 2011…
Full Story @ [Zero Hedge]
