In April, inflation eased to its lowest monthly growth in four years, while Americans’ personal income and rate of savings jumped, data released Friday by the Commerce Department’s Bureau of Economic Analysis (BEA) reveal.
As measured by the BEA’s Personal Consumption Expenditure (PCE) price index, prices increased 0.1% from March, as did the “core” index, which excludes the volatile food and energy categories.
Compared to the same month a year ago, April’s price index is up 2.1% and its core index is 2.5% higher – the slowest year-over-year growth for any month since February of 2021. Both numbers represent movement closer to the Federal Reserve’s target inflation rate of 2.0%.
While inflation was somewhat lower than analysts’ expectations, Americans’ disposable personal income (DPI) growth was far higher.
At 0.8%, the monthly increase in current-dollar personal income is nearly three times expectations and the largest growth in four years, CNBC’s Rick Santelli explains:
“Eight-tenths 90.8%) is the strongest month over month income jump since May of 2021 when it was 1.9%.”
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"They're powerful numbers: up 0.6% in January, up 0.7% in February, up half of one percent last month, up 0.8% this month. This is a GREAT four-month start to any year."
The personal saving rate (savings as a percentage of disposable personal income) jumped to 4.9% percent in April, up from 4.3% in March and the highest rate since 5.1% in April of 2024.
During former President Joe Biden’s administration, the personal savings rate fell from 12.6% to 4.6%. Under President Donald Trump’s first term in the White House, the savings rate increased from 5.6% to 12.6%.
CNBC: Personal income increased 0.8% in April — "almost TRIPLE the expectations." 🔥
— Rapid Response 47 (@RapidResponse47) May 30, 2025
"They're powerful numbers — up 0.6% in January, up 0.7% in February, up 0.5% last month, up 0.8% this month. This is a GREAT four-month start to any year." pic.twitter.com/s1Rx1KAYFl