When it comes to the American economy, the consumer is the primary driver. In order for consumers to push output ahead, they need income to spend.
Americans made more and spent more money in March 2018 according to the Bureau of Economic Analysis’ report on Incomes and Outlays. However, in typical American style, consumers spent faster than their incomes grew, so the savings rate suffered. Finally, inflation’s trend seems to be nearing the Federal Reserve’s explicit target.
Personal income and spending each improved to end 2017, but their rates of change were different. Americans’ pay managed to grow just 0.3 percent while outlays increased 0.5 percent. Additionally, there was a key revision to the prior period’s tally as outlays actually increased 0.8 percent (originally 0.6 percent), but November’s income tally remained as initially
Income and outlays improved in August 2017 according to the most recent data from the Bureau of Economic Analysis. Personal income rose 0.2 percent or $28.6 billion. Subtracting taxes, disposable personal income (DPI) increased $14.9 billion or 0.1 percent.