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The U.S. Commerce Department released personal spending and income figures on Tuesday. Personal spending rose 1.0% in April, exceeding expectations for a 0.7% gain, after a flat reading in March. It was the biggest rise since August 2009.
March's figure was revised down from a 0.1% increase.
Consumer spending makes more than two-thirds of U.S. economic activity. Consumer spending grew 1.9% in the first quarter, the slowest pace since the first quarter of 2015, after a 2.4% increase in the fourth quarter.
The saving rate declined to 5.4% in April from 5.9% in March.
Personal income increased 0.4% in April, in line with expectations, after a 0.4% gain in March.
Wages and salaries were up 0.5% in April.
The personal consumption expenditures (PCE) price index excluding food and energy rose 0.2% in April, in line with forecasts, after a 0.1% gain in March.
On a yearly basis, the PCE price index excluding food and index remained unchanged at 1.6% in April.
The PCE index is below the Fed's 2% inflation target. The PCE index is the Fed's preferred measure of inflation.
This data added to speculation the Fed may raise its interest rate in June.