Commentary: According to data provided by the Commerce Department consumer spending rose slightly more than expected in February for the eighth straight month as households drew on savings to make their purchases. Spending accelerated on a month-over-month basis by 0.7% while incomes grew by 0.3%. The core personal consumption expenditure index, the Fed's favorite measure of inflation at the consumer level, posted a 0.2% increase in February - matching January's gain. The surge in spending is not deemed to be sustainable since savings accounts can't be drawn down below a zero balance.
Mortgage investors largely shrugged this data off and remained focused on responding to indications of demand for this afternoon's Treasury Department's sale of $35 billion of 2-year notes, the first of three such auctions this week totaling $99 billion. Today's auction will conclude at 1:00 p.m. ET and I'll post the result on my website as soon as possible once the final gavel falls.
THE MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
