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Spending, income both rise
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May 3, 1999: 9:13 a.m. ET
American earning, consumption habits in lockstep while saving falters
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NEW YORK (CNNfn) - The U.S. economy continued to defy gravity during March as consumers immediately funneled their heightened earnings right back into products and services.
The U.S. Commerce Department reported Monday that personal income rose 0.4 percent to a seasonally-adjusted $7.382 trillion during March. The gain was slightly above analysts' expectations of 0.3 percent and matched the rise in personal income posted during February.
Consumer spending also rose a 0.4 percent to a seasonally-adjusted $6.08 trillion, half of February's revised 0.8 percent increase but in line with consensus estimates.
American attitudes toward savings continued to worsen, however. Personal savings as a percentage of disposable income fell 0.6 percent, mimicking a similar decline in February.
Economists believe the results don't portend future inflation concerns.
"Consumers are partying like it's 1999," Argus Research Senior Economist Richard Yamarone told CNNfn. "They are celebrating their full-employment status and they are spending. The punch bowl is only spiked with 1-1/2 percent inflation, which isn't anything."
Treasury prices were lower after the release of the report. The U.S. 30-year bond was down 10/32 to 93-25/32, yielding 5.68 percent.
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Commerce Department
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