PCE inflation stands at 2.3% and core PCE at 2.6% with disposable personal income increased by $102 billion
04/30/2025 01:00 pm EST
AJ Economy Trend - US neutral with inflation rate remaining steady and modest growth of personal income and disposable income
In March 2025, U.S. personal income rose by $116.8 billion (0.5%), driven primarily by higher compensation, especially in service industries, and gains in proprietors’ income, notably farm-related due to emergency aid payments. Disposable personal income (DPI) increased by $102.0 billion (0.5%), while personal consumption expenditures (PCE) grew $134.5 billion (0.7%), split between goods ($54.5B) and services ($79.9B).
Personal outlays rose $136.6 billion, and personal saving reached $872.3 billion, putting the personal saving rate at 3.9%.
Price pressures remained subdued:
The PCE price index was flat month-over-month (0.0%)
The core PCE (excluding food and energy) also showed no change
Year-over-year, PCE inflation stood at 2.3%, and core PCE at 2.6%
US Real GDP declined at an annual rate of 0.3% compared to 2.4% growth recorded in Q4 2024 due to cut in government spending
04/30/2025 01:00 pm EST
AJ Economy Trend - US down due to real GDP decline with cut on government spending
In Q1 2025, U.S. real GDP declined at an annual rate of 0.3%, reversing the 2.4% growth recorded in Q4 2024. The downturn was primarily driven by a surge in imports (which subtract from GDP) and a drop in federal government spending, particularly defense. These were only partially offset by gains in consumer spending, investment, and exports. Despite the headline contraction, real final sales to private domestic purchasers (a key measure of private sector demand) rose 3.0%, up slightly from 2.9% in Q4.
Inflation pressures intensified:
The gross domestic purchases price index rose 3.4% (vs. 2.2% in Q4)
The PCE price index climbed 3.6% (vs. 2.4%)
Core PCE, excluding food and energy, increased 3.5% (vs. 2.6%)
On the trade side, the rise in imports was driven by increased purchases of consumer goods (notably pharmaceuticals) and capital goods (like computers), while silver bar imports—treated as a store of value—were excluded from investment calculations. Consumer spending remained resilient, with gains in healthcare, housing, and utilities, though durable goods spending declined.
Germany’s unemployment rate held at 6.3% in April 2025
04/30/2025 01:00 pm EST
AJ Economy Trend - Germany down due to unemployment rate remained high and in record high since 2020
Germany’s seasonally adjusted unemployment rate held at 6.3% in April 2025, its highest since 2020 and matching expectations. The number of unemployed rose by 4,000 to 2.922 million, a smaller increase than the forecasted 15,000 to 20,000, suggesting some stabilization in the labor market. However, job vacancies declined by 55,000 year-over-year to 646,000, indicating weakening labor demand. Despite 0.2% GDP growth in Q1 2025, Germany's economy faces mounting pressure from industrial sluggishness and trade tensions, with the government projecting flat economic growth for the year and a persistently elevated jobless rate.
France’s annual inflation rate remained steady at 0.8% for the third consecutive month
04/30/2025 01:00 pm EST
AJ Economy Trend - France neutral with inflation rate remaining steady with low move of inflation rate
In April 2025, France’s annual inflation rate remained steady at 0.8% for the third consecutive month—the lowest since February 2021—matching expectations. A sharper drop in energy prices (-7.9%) was offset by rising food inflation (1.2%), particularly in fresh products (4.0%). Inflation for services (2.3%) and tobacco (4.1%) remained stable, while manufactured goods continued to deflate (-0.2%). On a monthly basis, consumer prices rose 0.5%, the highest since August 2024, driven by increases in transport services and food. The EU-harmonized inflation rate dipped to 0.8% year-on-year but climbed 0.6% month-on-month.
France GDP grew 0.1% quarterly growth in Q1 2025, recovering from contraction in Q4 2024
04/30/2025 01:00 pm EST
AJ Economy Trend - France neutral with France GDP moved slightly out of contraction from last quarter
France’s economy eked out 0.1% quarterly growth in Q1 2025, recovering from a slight contraction in Q4 2024 but missing forecasts of 0.2%. Inventory accumulation was the main driver (+0.5 percentage points), as final domestic demand made no contribution and net trade weighed on GDP. Household spending stagnated due to weaker goods purchases, though service consumption helped offset the dip. Government spending slowed, and fixed investment declined for a second quarter, particularly in construction and manufactured goods. Exports dropped sharply despite a temporary pause in U.S. tariffs, while imports continued to rise. On an annual basis, GDP grew 0.8%, slightly above expectations and matching the revised Q4 rate.