WASHINGTON, April 30 (Reuters) – U.S. household income rose
in March by the most in three months although consumers socked
away part of the extra cash by saving more and only modestly
increasing spending.
The Commerce Department said on Monday consumer income rose
0.4 percent last month. Analysts had expected a gain of 0.3
percent. After tax income climbed 0.2 percent in March when
accounting for higher prices.
Consumer spending rose 0.3 percent last month, also just
below the median forecast in a Reuters poll of 0.4 percent. When
taking into account inflation, spending was up 0.1 percent.
U.S. economic growth cooled in the first quarter as
businesses cut back on investment and restocked shelves at a
slower pace.
Stronger consumer spending over the entire quarter cushioned
the blow, but Monday’s data suggested consumers ended the
quarter spending less freely.
With consumption rising less quickly than income, the saving
rate edged higher to 3.8 percent.
A price index for personal spending rose 0.2 percent in
March. In the 12 months through March, the PCE index was up 2.1
percent, the lowest in a year but still just above the U.S.
Federal Reserve’s target of 2 percent.
