U.S. personal income rose half a percentage point in July, the U.S. Commerce Department reported August 31, right in line with what most economists expected. Personal spending grew eight-tenths of a percent, also in line with economists' expectations. That means, once again, Americans were dipping into savings to finance their spending.
Better news was that the Federal Reserve's favorite measure of inflation, the Commerce Department's core PCE index, rose just a tenth of a percentage point in July, half its June increase of two-tenths percent. The core PCE index reflects price changes for personal consumption expenditures except for food and fuel.