US income growth off to slow start in 2019
Americans’ incomes barely budged last month, while the overall U.S. economic growth shows signs of slowing.
On Friday, the Commerce Department said personal incomes rose just 0.2 percent in February – primarily reflected in wages and salaries and an increase in Social Security benefits at the start of the year. Gains were offset by a decline in personal interest income, according to the agency’s Bureau of Economic Analysis.
Meanwhile, personal income declined in January by 0.1 percent, while disposable personal income fell 0.2 percent. These losses were attributable to declines in personal dividend income, farm proprietors’ income and personal interest income.
Personal consumption expenditures rose 0.1 percent – the primary drivers were spending on financial services and insurances. On the flip side, the data reflected weak sales of new motor vehicles.
The personal savings rate, as a percent of income, was 7.5 percent.
The report combines data from January and February due to the partial government shutdown, during which no statistics were released.
Meanwhile, consumer spending increased by just 0.1 percent in January – falling short of expectations – while December’s numbers were revised slightly down.
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Many are anticipating softness in U.S. economic growth, after the Federal Reserve announced this month it did not intend to raise interest rates in 2019. During the central bank’s December meeting, it had projected two hikes for the year.
“There’s been some evidence the economy is slowing,” Minneapolis Federal Reserve President Neel Kashkari told FOX Business on Friday. “I’m not yet sure is this just a blip or is this a real slowdown?”