US: Personal income likely to grow at 0.3% in February - Nomura

Analysts at Nomura expect a steady 0.3% m-o-m increase in US personal income in February following a 0.4% gain in January.

Key Quotes

“The BEA adjusted up January wages and salaries to reflect one-time bonuses reported publicly in response to tax cuts earlier this year. As this adjustment was based on one-time bonuses, wages and salaries could revert in February.”

“For nominal personal spending, we expect a modest 0.2% m-o-m gain in February. Sales at auto and parts dealerships continued to fall and sales at other durable goods stores moderated in the month. Nominal spending on gasoline likely dropped, reflecting a decline in retail gasoline prices. Moreover, spending on electric and gas utilities likely declined as the weather was warmer in February relative to January. We expect a steady gain in service spending excluding outlays on utilities, offsetting weakness in other components.”