Consumer spending was flat in April as Americans increased savings, showing that households remained cautious at the start of the second quarter. Personal incomes rose a seasonally adjusted 0.4% last month after no gain in March, the Commerce Department said Monday. Economists polled by MarketWatch had forecast a 0.1% increase in spending and a 0.3% gain in income. Since incomes grew faster than spending, the amount of money individuals save climbed to 5.6% from 5.2%. Also, inflation as gauged by the PCE price index was unchanged in April. The PCE index has risen a scant 0.1% in the past 12 months. The core PCE index that excludes food and energy, meanwhile, rose 0.1% in April, and it's up 1.2% over the past year. The Federal Reserve wants to see inflation move closer to 2% on a year-over-year basis.
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