Monday, April 30, 2018

Personal Income increased 0.3% in March, Spending increased 0.4%

by Bill McBride on 4/30/2018 08:36:00 AM

The BEA released the Personal Income and Outlays report for March:

Personal income increased $47.8 billion (0.3 percent) in March according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $39.8 billion (0.3 percent) and personal consumption expenditures (PCE) increased $61.7 billion (0.4 percent).
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Real PCE increased 0.4 percent. The PCE price index increased less than 0.1 percent. Excluding food and energy, the PCE price index increased 0.2 percent.
The March PCE price index increased 2.0 percent year-over-year and the March PCE price index, excluding food and energy, increased 1.9 percent year-over-year.

The following graph shows real Personal Consumption Expenditures (PCE) through March 2018 (2009 dollars). Note that the y-axis doesn't start at zero to better show the change.

Personal Consumption Expenditures Click on graph for larger image.

The dashed red lines are the quarterly levels for real PCE.

The increase in personal income was slightly below expectations, and the increase in PCE was at expectations.

PCE growth was weak in Q1, however inflation is now near the Fed's target.