A decelerating economy is driving down personal income and spending in the U.S., reports RSM US LLP Chief Economist Joseph Brusuelas.
“… [A] slowing economy results in big drop in income and inflation adjusted spending,” Brusuelas posted on X, citing a May Spending & PCE Price Index revealing personal income declining $109.6 billion (0.4 percent at a monthly rate) in May.
Information provided by the U.S. Bureau of Economic Analysis specifically shows spending dropped $29.3 billion, or — 0.1 percent.
READ MORE: ‘Cruelty and criminality’: Experts say Trump ‘incapable of grasping how despised he is’
Disposable personal income (meaning personal income after paying taxes at current tax rates) decreased $125 billion (0.6 percent), which walks hand-in-hand with the falling personal consumption expenditures.
Graphs show motor vehicles and car parts took the biggest hit in May, with vehicle purchases and associated costs declining sharply, followed by food services and accommodations, including rent. Americans also spent less on financial services and insurance, and food and beverages.
“This is definitely not the time to cut SNAP and Medicaid, especially not to fund tax cuts for the wealthy,” posted Arin Dube, a provost professor of Economics at the University of Massachusetts, in Amherst.
Wall Street Journal economics correspondent and author Nick Timiraos noted the decline in personal income followed a drop in the U.S. personal savings rate as well.
READ MORE: Corporate media still hasn’t learned that Trump isn’t just a complete and total moron
“[T]he personal savings rate in May posted its first month-over-month decline since December, to 4.5 percent from 4.9 percent in April,” Timiraos wrote.
Read the Bureau of Economic Analysis report at this link.
