As another round of stimulus checks issued under the American Rescue Plan rolls out in April, new data shows prior checks led to a record rise in household income and spending power in March.
Household income rose to 21 percent in March and was the largest monthly increase for government records since 1959, according to data released from the US Commerce Department and published by the Wall Street Journal. Nationwide spending also rose by 4 percent and personal savings among Americans increased to 27 percent in March, which was almost 14 percent higher than in February. Researchers credit this growth to the $1,400 stimulus payments stipulated in the American Rescue Plan.
Read More: Americans could see a fourth stimulus check
In March, President Biden signed the $1.9 billion COVID-19 pandemic relief bill into law and researchers predict that vaccinations and business re-openings will maintain the momentum of an economic upswing.
“If we have COVID-19 cases under control, that would ideally make way for us to reopen the services sector of the economy. That, in fact, is a crucial aspect of ensuring that this recovery continues,” said Pooja Sriram, an economist and vice president of Barclays Investment Bank.
In addition to the increase in household income and spending, the US Commerce Department confirmed that the nation’s gross domestic product also rose to 6.4 percent, USA Today reports, and some economists anticipate a “summer boom” following the success of spring.
A few policymakers have lauded the financial boost the stimulus checks have given to working-class families. Last week, Democratic Speaker of the House Nancy Pelosi referred to a recent survey by the personal finance company Bankrate which found that most Americans put their stimulus toward groceries, rent, and other bills.
“For America’s working families, covid relief was exactly that — relief from past-due bills and going without basics,” said Pelosi. “The money Democrats put in people’s pockets is also helping our economy bounce back, laying a foundation to #BuildBackBetter for everyone.”
The Internal Revenue Service (IRS) urges those who have not received their $1,400 check to file their taxes as it is sending “plus up” stimulus payments by processing people’s tax returns, CNBC reports.
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