Personal Income Dropped 13% from March to April Without Stimulus Checks
Personal income in the United States fell 13.1 percent from March to April without the March one-time individual stimulus payouts, according to a Commerce Department study.
The Associated Press stated that billions of dollars in stimulus payments were given in March, resulting in a record 20.9 percent increase in personal income, and that a decline in April’s personal income was forecast. Americans raised their spending by 0.5 percent in April, compared to a 4.7 percent gain in March.
The Associated Press quoted Lydia Boussour, chief U.S. economist for Oxford Economics, as saying, “When given the chance to spend in a safe fashion, people have the will and desire to do so.”
Despite the fact that April’s spending growth was lower than March’s, it nevertheless demonstrates a recovering economy following the global pandemic’s beginning. According to government estimates, consumer and business spending accounted for the majority of the 6.4 percent growth in the US economy from January to March.
See the list below for more Associated Press reporting.
The fuel for expenditure is provided by personal incomes.
In addition, the Commerce Department’s report showed that inflation, as measured by the Federal Reserve’s preferred metric, increased by 3.6 percent in the 12 months ended in April, which was higher than predicted. The so-called core rise, which excludes volatile food and energy, was still a high 3.1 percent. Both values are well above the Federal Reserve’s inflation objective of 2%.
The increase in consumer spending in April bolstered the argument that the economy is swiftly recovering as individuals and businesses acquire more confidence in their ability to spend, hire, and invest.
In the current April-June quarter, the economy is expected to develop even faster. The forecast for the rest of the year is also improving, thanks to more government support worth trillions of dollars, higher mobility as immunization rates rise, and a spike in pent-up consumer demand. More Americans are venturing out to shop, travel, dine out and gather in large groups at sporting and entertainment venues. Many analysts predict that growth, as measured by the gross domestic product, will reach its highest level since at least 1984 in 2021.
During much of the past year, spending on services — from haircuts to airline tickets to restaurant meals — plunged as Americans hunkered down at home and spent mainly on physical goods. People are becoming increasingly aware of this. This is a condensed version of the information.