Personal income gained 0.4% in March after a 0.2% rise in February, according to the Commerce Department.
More importantly, disposal income after inflation increased from -0.3% in February to 0.0% in March because inflation subsided with falling crude oil prices. More confident consumers reduced savings and boosted real spending, after inflation, by 0.1% after a 0.7% fall over the previous two months. This report from the Commerce Department is consistent with numerous earlier March reports with an unusually weak February and a rebound in March.
"Although spending volume rose at a 1.4% annual rate in the first quarter, March spending was 0.5% less than December," said Jim Haughey, Newport Communications' senior economist. "This included an outsize 4.2% gain in nondurables and an atypical mid-expansion 1.1% dip in durables."
This means that the current quarter began on an upswing with accumulating evidence that improvement has continued into April.
Expect second quarter consumption to grow close to 3%, Haughey said.
More importantly, disposal income after inflation increased from -0.3% in February to 0.0% in March because inflation subsided with falling crude oil prices. More confident consumers reduced savings and boosted real spending, after inflation, by 0.1% after a 0.7% fall over the previous two months. This report from the Commerce Department is consistent with numerous earlier March reports with an unusually weak February and a rebound in March.
"Although spending volume rose at a 1.4% annual rate in the first quarter, March spending was 0.5% less than December," said Jim Haughey, Newport Communications' senior economist. "This included an outsize 4.2% gain in nondurables and an atypical mid-expansion 1.1% dip in durables."
This means that the current quarter began on an upswing with accumulating evidence that improvement has continued into April.
Expect second quarter consumption to grow close to 3%, Haughey said.
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