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US Personal Income, Spending Growth Expected to Slow, Price Growth Still Elevated

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Personal income is forecast to rise by 0.4% in April, based on a survey compiled by Bloomberg, following a 0.6% increase in March.

The report on personal income and consumption for April is scheduled to be released at 8:30 am ET Thursday.

Wages and salaries are seen as a positive for the headline figure. Private nonfarm payrolls rose by 115,000 in April after a 185,000-jobs increase in March, while the average workweek increased to 34.3 hours from 34.2 hours, lifting the aggregate hours index by 0.3% in the month. Hourly earnings rose by 0.2% in April after a matching gain in the previous month.

For consumption, control group retail sales, which exclude motor vehicles, gas building materials and food services and feeds into the goods PCE calculation, rose by 0.5% in April after a 0.9% gain in the previous month.

Analysts expect personal consumption to increase by 0.5% in April after a 0.9% gain in March. Real PCE, consumption after adjustment for inflation, is expected to increase by 0.1% after 0.2% gain.

PCE prices are forecast to rise by 0.5% after a 0.7% gain in the March report, while core prices are expected to rise by 0.3% for another month.

Analysts expect the year-over-year rate for overall PCE prices to accelerate to 3.8% from 3.5% in March while core PCE prices are seen at 3.3%, up from 3.2% in March.

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