Key Points

  • Consumer purchases climbed 1 percent in April (versus 0.7 percent forecast) after little change in March
  • Increase in spending was the biggest since August 2009
  • Personal income climbed 0.4 percent for a second month
  • Fed’s preferred measure of inflation (tied to consumer spending) climbed 0.3 percent from month before, the biggest May 2015; 1.1 percent from year before

Big Picture

Households will need to do the heavy lifting if a growth rebound is to materialize this quarter as global demand and corporate investment remain sluggish. Continued increases in payrolls and a gradual pickup in wages should help give consumers the means and the willingness to spend.  Read More….