The report largely pre-dates the Middle East war that analysts expect to dramatically impact the March figures.
Personal income dipped 0.1 percent from January, according to Commerce Department figures. Analysts had expected growth of 0.5 percent.
The weak personal income reading comes as affordability concerns loom large for many US households, posing political challenges to US President Donald Trump.
These challenges have been worsened by the Middle East war, which the US-Israel alliance launched on February 28.
The estimate for personal consumption expenditures, the Federal Reserve’s preferred benchmark for measuring inflation, climbed 0.5 percent from the prior month.
From the same month a year ago, the PCE price index rose 2.8 percent. That’s the same level as in the year-over-year January comparison.
Excluding food and energy components, inflation rose three percent from a year ago, down from 3.1 percent last month.
“Consumer inflation was firming even prior to the outbreak of war in the Middle East, and it is primed to jump sharply higher in March,” said Nationwide Chief Economist Kathy Bostjancic.
Even if the truce holds and the Strait of Hormuz is reopened, “it would take months for oil, gasoline, diesel and other commodity supplies to snap back to pre-war levels,” Bostjancic said.
“The elevated energy and commodity prices will weigh on consumer discretionary spending and lift inflation, especially in the near-term.” (AFP)
