Consumers adopted a more conservative approach to their income last month. Personal income increased 0.4% (3.2% y/y) during March after a 0.3% February increase, last month reported as 0.2%. Last month's increase reflected a 0.3% rise (4.4% y/y) in wages and salaries after three months of 0.4% increase. Rental income surged 0.9% (11.8% y/y) as home renting remained strong relative to ownership. Proprietors' income increased 0.6% (3.3% y/y). Lower interest rates continued to weigh on interest income which rose 0.3% for the third straight month, but it fell 2.3% y/y. Conversely, dividend income jumped 0.7% (6.2% y/y) with strong corporate profitability.

Individuals enabled the income gain to stabilize the earlier draw-down of savings. The personal savings rate ticked up to 3.8% from an unrevised 3.7% during February. Nevertheless, it remained below the 4.9% level twelve months ago and at a 2010 monthly high of 5.8%.

Growth in personal consumption expenditures eased to just 0.1% following a 0.5% February increase, revised from 0.8%. Last month's weakness reflected a 2.2% decline (+13.1% y/y) in motor vehicle purchases which was a breather after several months of strong gain. Conversely, furniture expenditures rose a strong 1.0% (6.8% y/y) and clothing spending increased 0.5% (5.9% y/y). Higher gasoline prices increased purchases by 3.6% but less driving & more fuel efficient vehicles limited the y/y gain to 3.5%. Purchases fell 2.7% y/y when adjusted for higher prices. Spending on services inched up 0.1% (3.3% y/y), the y/y gain boosted by 7.2% y/y growth in recreation and a 6.3% annual rise in food services & accommodations as they traveled more.

The PCE chain price index rose 0.2% an easier last month (2.1% y/y). The increase reflected a 1.7% rise (6.4% y/y) in gasoline prices after a 5.7% February increase. The core PCE price index increased 0.2% and the y/y increase of 2.0% was up from the record low 12-month change of 0.9% reached last December.

The personal income & consumption figures are available in Haver's USECON and USNA databases. The expectations figures are in the AS1REPNA database.