Personal income increased by 0.4% in April; Expenses increased by 0.8%

To Estimated risk per 05/26/2023 8:40:00 AM

BEA released Personal income and expenses April report:

Personal income increased to $80.1 billion (0.4 percent m/m) in April., according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased to $79.4 billion (0.4 percent). personal consumption expenditure (PCE) rose $151.7 billion (0.8 percent).

The PCE price index increased by 0.4 percent. Excluding food and energy, the personal spending price index increased by 0.4 percent. Real DPI increased by less than 0.1% in April, while real PCE increased by 0.5%; goods increased by 0.8 percent and services increased by 0.3 percent.
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April’s PCE price index increased 4.4% year-on-year from 4.2% year-on-year in March and is down from a recent peak of 7.0% in June 2022.

The PCE price index, excluding food and energy, rose 4.7% year-on-year from 4.6% in March and down from a recent peak of 5.4% in February 2022.

The following chart shows real personal consumption expenditure (PCE) through April 2023 (in 2012 dollars). Note that the y-axis does not start at zero to better show the change..

Personal consumption expenditure Click on the graph to enlarge the image.

The red dotted lines are quarterly real PCE levels.

Personal income was in line with expectations, and PCE exceeded expectations.

Inflation exceeded all expectations.