Consumers are growing more cautious.Personal income increased 0.5% (3.5% y/y) last month following a revised 0.3% May rise. A 0.4% June gain was expected. Wages and salaries were firm and posted a 0.5% rise (3.5% y/y) after a little-revised 0.1% May uptick. A 0.9% increase (-0.7% y/y) in interest earnings and a 1.4% jump (9.5% y/y) in dividend income provided the real strength to the income rise. Disposable income rose a firmer 0.4% (3.2% y/y) while inflation-adjusted take-home pay increased 0.3% (1.7% y/y) after an upwardly revised 0.5% May rise.

Consumers took the opportunity afforded by the income gain to lift their savings by 12.1% m/m and increase the savings rate to 4.4%, the highest level in twelve months. 

Personal consumption expenditures slipped marginally in June for the second consecutive month. A 0.1% rise was expected. Adjusted for prices, spending fell 0.1% (2.0% y/y). In real terms, inflation-adjusted spending on durable goods was unchanged (8.2% y/y) while real outlays on nondurables fell 0.4% (+1.5% y/y). Real services spending was flat m/m (1.2% y/y).  

The PCE chain price index ticked up 0.1% (1.5% y/y) in June after a 0.2% May decline. Durable goods prices slipped 0.1% (-1.6% y/y) while nondurables costs dipped 0.1% as well (+1.3% y/y). Services prices rose 0.2% (2.1% y/y). Less food and energy, the PCE chain price index gained 0.2% (1.8% y/y), its strongest increase since March.

The personal income & consumption figures are available in Haver's USECON and USNA databases. The consensus expectations figures are in the AS1REPNA database.