Consumer Income and Spending Rise Household income in the United States rose in March by the most in three months, the Commerce Department said Monday, but consumers socked away part of the extra cash and only modestly increased spending. Consumer income rose 0.4 percent last month. Analysts had expected a gain of 0.3 percent. After-tax income climbed 0.2 percent in March after accounting for higher prices. Spending rose 0.3 percent last month, also just below the median forecast of 0.4 percent in a Reuters poll. When taking into account inflation, consumer spending was up 0.1 percent. "The spending number is an indication that the higher gas prices we saw last month are taking their toll," said Todd Schoenberger, managing principal at the Black Bay Group in New York. Overall economic growth cooled in the first quarter, as businesses cut back on investment and restocked shelves at a slower pace. The economy grew at an annualized pace of 2.2 percent in the first three months of the year, data on Friday showed, a slowdown from the fourth quarter's 3 percent rate. 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 index was up 2.1 percent, the lowest in a year but still just above the Federal Reserve's target of 2 percent. Another measure of prices suggested some build-up of inflationary pressure, however. The core index, which strips out volatile food and energy prices and is often read as a measure of inflation trends, rose 2.0 percent in March from a year earlier, the biggest year-over-year rise since November 2008.