Income Growth Above Average for Third Month

March real disposable income was $12,258 billion dollars (seasonally adjusted at an annual rate). This was the second highest level of disposable income ever. In addition, the month-over-month rate of growth was 3.3% in March. This was the fifth month in a row where incomes grew at least 3.0% compared with one year ago. And, this was the fourth month in a row of above average income growth. However, the rate of growth decelerated the last two months. On an annual basis, the rate of growth in income was unchanged from last month. It appears that income growth may have peaked. Therefore, the change in income is neutral for the future of manufacturing and capital equipment spending.

Real disposable income is one of the earliest leading indicators for the following end markets: aerospace; construction materials; custom processors; electronics/computers/telecommunications equipment; food/beverage processing; forming/fabricating (non-auto); hardware; HVAC; industrial motors/hydraulics/mechanical components; machinery/equipment manufacturing; metalcutting job shops; oil/gas field/mining machinery; power generation; primary metals; and printing.