US Personal Spending Growth at Nearly 7-Year High

Consumer spending in the United States rose 1 percent in April from March of 2016, after posting no growth in the previous period and much better than market expectations of a 0.7 percent gain. It is the highest growth since August of 2009 as consumption of nondurable goods rebounded. Meanwhile, personal income increased 0.4 percent, suggesting a robust and accelerating economic recovery.
BEA | Joana Taborda | joana.taborda@tradingeconomics.com 5/31/2016 1:57:38 PM
Consumption in durable goods went up 2.3 percent, rebounding from a 0.1 percent fall in March; spending in nondurables rose 1.4 percent, higher than 0.4 percent in March and services expenditure increased 0.6 percent after stalling in March. 

Personal income increased 0.4 percent, the same as in the previous month and in line with expectations. Wages and salaries increased $38.6 billion in April, compared with an increase of $30.7 billion in March. Private wages and salaries rose $37.2 billion, compared with an increase of $27.6 billion. Government wages and salaries went up $1.4 billion, compared with an increase of $3.1 billion. Supplements to wages and salaries increased $5.9 billion in April, compared with an increase of $5.5 billion in March.

The personal consumption expenditure price index rose 0.3 percent on the month and 1.1 percent on the year (0.1 percent and 0.8 percent respectively in March). Core PCE inflation also accelerated to a monthly rate of 0.2 percent and an annual of 1.6 percent (0.1 percent and 1.6 percent respectively in March).

US Personal Spending Growth at Nearly 7-Year High