Personal income increased 0.8% MoM in April, well above expectations of a 0.3% MoM gain. Real disposable income growth was a strong 0.7% MoM.

• Despite strong income growth, PCE increased just 0.2% MoM, in line with expectations, as goods spending fell -0.1% MoM and services spending increased 0.4% MoM.
• Services spending increased $55.8 billion, led by spending in housing & utilities (+$24.7 bil) and health care (+$20.3 bil), offsetting an $8.0 billion decline in goods spending.
• The personal saving rate rose 0.6 ppts to 4.9%, with total savings at $1.12 trillion.
• The PCE Price Index was up just 0.1% MoM and 2.1% YoY in April, slowing from 2.3% YoY in March and below expectations of a 2.2% YoY increase.
• Core PCE inflation slowed to 2.5% YoY in April, down from 2.7% YoY in March and the lowest since March 2021.