The Federal Reserve Bank of New York's latest U.S. Economy in a Snapshot showed little movement in consumer spending in March, despite lower gasoline prices, growth in real disposable income and a labor market showing steady improvement.
Robert Rich, assistant vice president, research and statistics at the New York Fed, said Thursday noted that there is a change in consumers’ behavior when it comes to savings. The personal savings rate increased to 5.4% in March. It was 5.2% in the first quarter, above the fourth quarter average of 5%.
Consumers may be focusing on building their precautionary savings, Rich said, and, with low interest rates, people are realizing they need to save more for retirement.
The consumer spending data also shows real personal consumption expenditures in March increased less than 0.1% after a 0.3% increase in February. This occurred while real disposable income increased 0.3% in March, which is considered a "robust pace,” by the New York Fed and at an annualized growth rate of 2.9% during the first quarter.
U.S. Economy in a Snapshot, released monthly after launching in June 2015, is designed to provide a condensed, comprehensive overview of current economic and financial developments. It presents charts and commentary on a broad range of topics that include labor and financial markets, consumer behavior and the global economy.
The New York Fed is hoping to help consumers and businesses better understand the economy and identify the key economic data releases and financial variables to focus on, according to a news release.
"Our goal is to provide information that helps households and businesses follow the data along with the Fed,” said Federal Reserve Bank of New York President and CEO William Dudley. "If people know more about how the economy is performing and how that is likely to influence our actions, this should make it easier for us to achieve our twin objectives."