Retail sales growth for August came in a bit below expectations (+0.6% month-to-month), but was still positive.

This advance data will be revised next month, possibly significantly.

But this nevertheless supports the interpretation that much of the FPUC was saved. /1

This is interesting given that some data was showing a marked slowdown in spending growth among UI recipients in August. /2 https://twitter.com/ernietedeschi/status/1303002419085955072">https://twitter.com/ernietede...

If we assume a marginal propensity to consume out of UI of 0.73, that suggests that UI recipients would have to draw on around $50 billion of savings a month to maintain their pre-August consumption. /3

If all non-consumed UI benefits between April and July had been saved, that would imply around $100 billion in savings, or two months of reserves to draw on to maintain consumption. However... /4

...almost certainly not all non-consumed benefits were saved. Some went to pay down debt / catch up with old bills. So the "reserve" here is likely less than 2 months.

On the other hand, the $300/week Lost Wages Assistance program at $44 billion will probably add a month. /5

So even if the savings hypothesis is true, UI workers can& #39;t keep drawing on savings forever. LWA might provide a cushion through Sept (once they actually start hitting worker wallets) but afterward that probably only leaves 1 more month of savings without another fiscal deal. /6