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- Korea: Motie Trade Press (Apr)
- US: Consumer Sentiment (Apr-final), Personal Income (Mar), Employment Cost Index (Q1)
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Economy in Brief
U.S. Chicago Business Barometer Continues to Strengthen in April
The ISM-Chicago Purchasing Managers Business Barometer strengthened to 72.1 in April...
U.S. Employment Cost Growth Ticks Up in Q1
The employment cost index (ECI) for civilian workers rose 0.9% in the first quarter of 2021...
EMU GDP Falls in Q1 2021
GDP across the euro area remains challenged, falling in Q1 2021...
U.S. GDP Growth Acceleration Paced by the Consumer in Q1'21
Real GDP surged 6.4% (SAAR) during Q1'21...
U.S. Pending Home Sales Rebound in March
Pending home sales increased 1.9% (23.3% y/y) during March...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller April 30, 2021
• Total income jumps and wages strengthen.
• Spending increases broadly.
• Pricing power picks up.
Personal income jumped a record 21.1% during March (29.0% y/y) after a 7.0% February fall, revised from -7.1%. A 19.7% rise had been expected in the Action Economics Forecast Survey. Transfer payments jumped with the federal government's $1,400 stimulus payments to most individuals. Wages & salaries surged 1.1% (4.4% y/y) with strength in payroll employment. Proprietors' income jumped 6.2% (11.6% y/y) after strengthening 3.0% in February. Rental income rose 1.0% (2.5% y/y) following two straight 0.9% gains. Earnings on assets rose 0.3% (-2.3% y/y) as dividend income held steady (-4.2% y/y) and interest income improved 0.6% (-0.9% y/y). Disposable personal income surged 23.6% (32.3% y/y) last month after falling 7.9% in February. Adjusted for price inflation, real disposable income improved 23.0% (29.3% y/y) after an 8.1% February decline.
Consumer spending rebounded during March following the prior month's decline due to inclement weather. Personal consumption expenditures surged 4.2% (11.0% y/y) following an unrevised 1.0% decline. A 4.0% rise had been expected. Adjusted for price inflation, spending surged 3.6% (8.5% y/y) after falling 1.2%. The rise in outlays reflected a 10.3% jump (44.0% y/y) in outlays on durable goods, led by a 13.6% surge (60.7% y/y) in spending on motor vehicles & parts. Outlays on recreational goods & vehicles increased 10.6% (37.3% y/y) after falling 5.1% in February. Spending on furniture & appliances rebounded 8.2% (30.7% y/y) following a 5.6% drop. Nondurable goods purchases rose 5.6% (5.5% y/y). Clothing spending surged 16.4% (60.5% y/y) after falling 5.5% in February. Food & beverage sales recovered 3.2% (-8.4% y/y) after falling 2.2% while spending on gasoline gained 2.7% (8.9% y/y). Real outlays on services increased 1.7% (4.3% y/y) as restaurant & hotel spending rebounded 11.7% (22.8% y/y) after falling 1.6% in February. Recreation services outlays ballooned 6.3% (4.4% y/y). Transportation service outlays strengthened 9.5% (10.6% y/y) as travel restrictions were eased. Health care outlays improved 0.9% (14.3% y/y), but housing & utilities spending eased 0.3% (+1.4% y/y).
The personal savings rate surged to 27.6% in March from 13.9% in February. The rate reached a record high 33.7% in April of last year. The level of personal saving rose by 144.3% in March (183.5% y/y).
The PCE chain price index increased 0.5% (2.3% y/y) last month following a 0.2% February rise. The price index excluding food and energy rose 0.4% (1.8% y/y) after a 0.1% uptick. Energy prices jumped 4.9% (13.1% y/y), strong for the fourth straight month. Food & beverage prices rose 0.2% (2.9% y/y), as they did in February.
The personal income and consumption figures are available in Haver's USECON database with detail in the USNA database. The Action Economics figures are in the AS1REPNA database.
| Personal Income & Outlays (%) | Mar | Feb | Jan | Mar Y/Y | 2020 | 2019 | 2018 |
|---|---|---|---|---|---|---|---|
| Personal Income | 21.1 | -7.0 | 10.3 | 29.0 | 6.1 | 3.9 | 5.3 |
| Wages & Salaries | 1.1 | 0.0 | 0.8 | 4.4 | 0.2 | 4.7 | 5.0 |
| Disposable Personal Income | 23.6 | -7.9 | 11.6 | 32.3 | 7.0 | 3.7 | 5.8 |
| Personal Consumption Expenditures | 4.2 | -1.0 | 3.4 | 11.0 | -2.7 | 3.9 | 4.9 |
| Personal Saving Rate | 27.6 | 13.9 | 20.0 | 12.9 (Mar '20) | 16.3 | 7.5 | 7.8 |
| PCE Chain Price Index | 0.5 | 0.2 | 0.3 | 2.3 | 1.2 | 1.5 | 2.1 |
| Less Food & Energy | 0.4 | 0.1 | 0.2 | 1.8 | 1.4 | 1.7 | 2.0 |
| Real Disposable Income | 23.0 | -8.1 | 11.3 | 29.3 | 5.8 | 2.2 | 3.6 |
| Real Personal Consumption Expenditures | 3.6 | -1.2 | 3.1 | 8.5 | -3.9 | 2.4 | 2.7 |





