The third round of pandemic relief checks helped produced a record increase in incomes last month, the Bureau of Economic Analysis reported Friday.
Following a 7% dip in February, U.S. personal incomes soared by 21.1% in March, the largest month-over-month jump on record dating back to 1946. Purchases of goods and services also rose, climbing 4.2%, the largest increase since June.
The direct payments of up to $1,400 per person, authorized by the $1.9 trillion Covid relief bill President Joe Biden signed into law in March, played a major role in the increase. The relief payments came to $3.9 trillion during the month, more than 90% of the $4.2 trillion overall increase.
Savings rose sharply as well, with the personal savings rate climbing to 27.6% in March, the highest on record except for last April, when the first round of relief payments was distributed.
Biden says to keep pushing: In an interview with NBC’s Today Show Friday, Biden was asked why he is proposing to ramp up both spending and taxes in the middle of the economic recovery. “That’s the reason why it’s recovering,” he said. “Because we’re investing. Look how rapidly it’s recovered since we passed the last piece of legislation, and that legislation was $1.9 trillion. If we don’t invest in this country, we’re going to actually start to, we’re going to fall behind even further.”