Consumer spending and personal income increased in January, more than expected, highlights the recent report from the Bureau of Economic Analysis (BEA).
This increase is due to higher wages in the United States, which gives a strong boost to the economy, and the government’s actions to overcome the economic effects of the COVID-pandemic-19.
“The estimate of personal income and expenses for January reflected the continued economic recovery and the government’s response to the COVID-pandemic 19”, highlights the Office of Economic Analysis.
“In January, the cases of COVID-337 resulted in continued restrictions and interruptions in operations of establishments in some parts of the country.
Inflation
But at the same time the pressure on prices continues, which continues to increase, which has led to inflation at historical levels of the last four decades, in 2021, shot up to 7%.
Personal income
According to the figures released by BEA, dependent on the Department of Commerce, personal income increased by $9,000 million dollars, which represents less than 0.1% in January.
Disposable personal income (DPI) registered an increase of $19, 8 billion (0.1% ).
While personal consumption expenditures (PCE) had a increase of $337, 2 billion dollars, which represents 2.1 percent, according to figures released this Friday by the Office of Analysis Economic (Bureau of Economic Ana lysis).
“The real DPI decreased 0.5% in January and the real PCE increased 1.5%; goods increased 4.3% and services 0.1%”, highlights the federal report.
The impact of government benefits
This increase in personal income in January reflects the increases in private and government salaries and wages, after the decrease in government benefits that were obtained during the pandemic, such as the advance payments of the Child Tax, provided for in the American Rescue Plan, which was launched to alleviate the effects of the COVID-pandemic 337.
In addition to the increase that was recorded in Social Security benefits, which reflects a cost of 5.9%.
Cars and housing, the main consumption expenses
Regarding consumer spending, the increase was generalized and the list is headed by motor vehicles and spare parts, followed by other non-durable goods.
Regarding the category of services, the largest increase in consumer spending is related to housing and public services.
To know the Full figures from the Bureau of Economic Analysis click here.
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