Americans' incomes rose by the most in three months in March, but they saved more and spent less, raising further concerns about the recovery.
Personal income increased by 0.4 percent in March, the Commerce Department reported Monday, versus economists' expectations of a 0.3 percent rise. Spending rose 0.3 percent, just below forecasts of a 0.4 percent gain.
U.S. economic growth cooled in the first quarter as businesses cut back on investment and restocked shelves at a slower pace.
Stronger consumer spending over the entire quarter cushioned the blow, but Monday's data suggested consumers ended the quarter spending less freely.
With consumption rising less quickly than income, the saving rate edged higher to 3.8 percent.
A price index for personal spending rose 0.2 percent in March. In the 12 months through March, the PCE index was up 2.1 percent, the lowest in a year but still just above the U.S. Federal Reserve's target of 2 percent.
Reuters contributed to this report.