LConsumer spending and personal income increased in Januarymore than expected, highlights the recent report of the Office 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-19 pandemic.
“The estimate of personal income and expenses for January reflected the continued economic recovery and the government’s response to the COVID-19 pandemic.highlights the Office of Economic Analysis.
“In January, cases of COVID-19 resulted in continued restrictions and disruptions to establishment operations in some parts of the country.”
But at the same time the pressures on prices continue, which continue to increase, which have led to the inflation at historical levels of the last four decades, in 2021, it shot up to 7%.
According to figures released by BEA, depending on the Department of Commerce, personal income increased by $9 billionwhich represents less than 0.1% in January.
The disposable personal income (DPI, for its acronym in English), registered an increase of $19.8 billion (0.1%).
while the personal consumption expenses (PCE) had an increase of $337.2 billion dollars, which represents 2.1 percent, according to figures released this Friday by the Bureau of Economic Analysis.
“Real DPI decreased 0.5% in January and real PCE increased 1.5%; goods increased 4.3% and services 0.1%”, highlights the federal report.
The Impact of Government Benefits
That increase in personal income in January reflects the increases in private and government wages and salaries, after the decrease in government benefits that were obtained during the pandemicas were the advance payments of the Child Tax, provided for in the American Rescue Plan, which was launched to alleviate the effects of the COVID-19 pandemic.
In addition to the increase recorded in Social Security benefits, which reflects a cost of 5.9%.
Cars and housing, the main consumption expenses
As for 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 greatest increase in consumption expenses is related to housing and public services.
To see the full figures from the Office of Economic Analysis, click here.
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