JP Morgan have lifted their economic growth projection based on a 'strong start for consumer'.
Citing (in summary):
- The main details of the July personal income and spending report came out pretty close to our expectations.
- Real consumption jumped 0.6% in July, nominal income rose 0.2%, and the headline PCE price index rose 0.2% (3.3% oya) while the core PCE price index increased 0.2% (4.2%oya).
- While there weren't big surprises in today's report, we are now revising our 3Q real GDP growth forecast from 2.5% to 3.5% saar. We had been noting upside risk to our earlier estimate for a while and we now have almost the full set of relevant source data for the first month of the quarter in hand. Furthermore, the downward revision to 2Q inventories released yesterday also was supportive of 3Q growth.
