Personal income and spending for July was steady and matching Wall Street expectations.  Income climbed 0.4%, matching the highest level for the year, the best since March, and the string of month to month improvements in more than a year.

• Income +0.4%
• Spending +0.3%
• Savings+ 5.7% from 5.5%

Disposable Income and Spending

Overall disposable income climbed to $12,705.9 billion from $12,651.7 billion or $43,362 from $43,207 per capita.  Interestingly, savings of overall income increased while savings of disposable income decreased to 5.7 from 6.1%.

Conclusion

Consumer spending has been the only thing holding up this economy and with the Fed becoming more vocal about the need for private investment, its clear many observers are anxious over how long households can do all the heavy lifting.  The key will be higher wages, which could extend the spending spree.  Although, within the numbers, we still see households sensitive enough they’ll switch to eating at home with only a slight uptick in eating outside the home.

On that note, I suspect we will see improved business spending and investment as we approach the election.  As a matter of fact, companies having delayed spending for so long, it’s becoming detrimental to their long term business potential.