5.27.22 Savings Rate Falls as Inflation Takes a Bite
The latest personal income and spending data from the Bureau of Economic Analysis show that part of the driver of spending growth in April was from savings. Another engine driving consumer spending was credit card usage but first, consider the savings rate.
Real consumer spending rose 0.7% in April, the fourth consecutive monthly increase in real spending. The job market is tight, supporting consumer spending from gains in personal income, but the real cushion for consumers comes from excess savings accumulated during the pandemic. The savings rate in April fell to 4.4%, the lowest rate since 2008. But since the consumer is
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