U.S. Consumer-Spending Rebound Cools, Hinting at More Risk Ahead

• The rebound in U.S. consumer spending moderated in July amid a surge in virus cases, with outlays at risk of further softening after cuts in supplemental relief payments for jobless Americans.
• Household outlays rose 1.9% from the prior month following an upwardly revised 6.2% rise in the prior month, a Commerce Department report showed Friday. That compared with economists’ estimates for a 1.6% gain. Personal incomes rose 0.4%, topping expectations for a slight decline.
• The deceleration in spending -- which accounts for about two-thirds of the economy -- marks a tempering in the economic recovery following two months of stronger gains.
• While spending has increased in recent months, total outlays remain below pre-pandemic levels. Spending could take a further hit in August after the expiration of the extra $600 in weekly jobless benefits at the end of July, which had propped up incomes and consumption.

(Source: Bloomberg)