American consumers earned and spent more in April, while the pace of inflation was roughly as expected, a government report showed.
The Commerce Department said consumer spending rose 0.6% last month, matching estimates, while personal income rose 0.5%, two tenths of a percentage point below forecasts. The rise in consumer spending in March was revised down to 0.5%. Personal income also rose by 0.5% in the previous month.
Meanwhile, the report's closely watched inflation metric, the core personal consumption expenditures index, rose 2.1% in April from a year ago, matching forecasts. The reading is slightly above the high end of the
comfort range of 2%.
The gain in the core PCE was 0.2% from March.
Stripping out the impact of higher prices, spending on durable goods rose 0.3% in April from March, while spending on nondurable goods rose 0.2%. Incomes were 5.4% higher in April than they were a year ago, the Commerce Department said.
Stock futures had a mixed reaction to the report, with the
going from flat to up about 2 points and the Nasdaq 100 falling to 2 points below fair value. The yield on the 10-year Treasury bond went to 5.09% from 5.07%.