US consumers kept spending in April while the pace of inflation moderated, a government report showed today.
The report bolstered market expectations that the Federal Reserve can take its time in raising interest rates.
Personal spending was up 0.3 per cent , the Commerce Department said, matching Wall Street forecasts.
March's gain was revised to 0.5 per cent from 0.4 per cent initially reported and confirms shoppers were still adding to the US economy at the start of the second quarter after a hefty contribution in the first three months of the year.
The report also showed inflation slowing last month, with a price index for consumer spending gaining 0.1 per cent after an unrevised 0.3 per cent rise in March. The so-called core index, which strips out energy costs, also rose 0.1 per cent , after climbing 0.2 per cent the previous month.
Personal income rose 0.6 per cent in April, slightly higher than forecasts of a 0.5 per cent rise. Taking inflation and taxes into account left disposable income up 0.4 per cent .
Analysts expect consumption to moderate as Americans adjust to 21-year high oil prices and escalating debt payments as market interest rates advance.