Today's U.S. GDP report

Today's U.S. GDP report revealed upwardly revised Q3 personal income growth of -10.0% (was -10.2%) for total income and -12.9% (was -13.2%) for disposable income, leaving drops that were much smaller than analysts had assumed, after hiked respective Q2 rates of 35.8% (was 34.2%) and 46.2% (was 44.3%). The savings rate fell to 16.1% (was 15.8%) in Q3 from 26.0% (was 25.7%) in Q2, as CARES Act payments boosted Q2 income by substantially more than the pandemic depressed it, followed by an unwind of CARES Act payments in Q3 alongside an underlying income rebound. The GDP data imply a Q3 productivity growth trimming to 3.9% from 4.9%, after an unrevised 10.6% Q2 gain. Analysts expect an unrevised 43.5% Q3 growth for the BLS output measure, following a -36.8% Q2 contraction rate. Analysts expect a 37.8% (was 36.8%) Q3 growth rate for hours-worked, after an unrevised -42.9% Q2 drop. Analysts saw big upward compensation revisions in the Q2 and Q3 GDP data, and analysts now expect Q3 growth in compensation per hour of -2.2% (was -4.4%), after a 21.9% (was 20.0%) Q2 clip. The mix should leave Q3 unit labor cost growth of -5.7% (was -8.9%), after a revised 10.4% (was 8.5%) Q2 pace.