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Data: U.S. Bureau of Economic Analysis; Chart: Dion Rabouin/Axios Visuals

The record 21.2% increase in Americans' personal income in March was notable not only for its rise but for its causes and outcomes.

Between the lines: The Bureau of Economic Analysis pointed out in its monthly report on income and outlays that the increase in personal income "largely reflected an increase in government social benefits."

  • But rather than spend their stimulus checks and enhanced unemployment benefits, most Americans chose to put the money away, with the U.S. personal savings rate jumping to 27.6%, edging back toward the all-time high set in April 2020.

Watch this space: Spending, on the other hand, rose by a "relatively tame" 4.2% in March, notes AllianceBernstein senior economist Eric Winograd.

Between the lines: That should translate into more spending in the second quarter, Winograd says, and that data already is playing out in inflation metrics like personal consumption expenditures and the consumer price index.

  • Both showed not just significant year-over-year rises but surprisingly strong month-over-month readings for March (0.4% for the Fed's favored core PCE reading).
  • "With the demand side of the economy in strong shape and the supply side still constrained by production bottlenecks and capacity limitations, we should expect inflation to continue rising for the next few months," Winograd says in a note to clients. 
  • "The Fed also expects that, and they view those increases as likely to be transitory.  I agree with that assessment, but of course it will be several months before we can be certain."

In the meantime: Investors have been loading up on inflation protection, data from Refinitiv Lipper show.

  • Inflation-protected bond funds saw record inflows in the first quarter that that was more than 10 times the quarterly average ($19.2 billion in Q1 vs $1.7 billion average dating back to 2003).
  • Inflation-protected bond funds saw net outflows this past week for the first time in 28 weeks, ending the longest streak since the start of 2008 where they witnessed 70 straight weeks of inflows, notes Jack Fischer, Refinitiv Lipper's senior research analyst.

Go deeper

Updated 3 hours ago - World

Death toll mounts as fighting between Israel and Hamas intensifies

Palestinian Muslims exchange wishes for Eid al-Fitr, marking the end of the holy month of Ramadan, near a razed building in the northern Gaza Strip town of Beit Lahia, on May 13. Photo: Majdi Fathi/NurPhoto via Getty Images

At least 109 Palestinians and seven people in Israel have been killed since recent fighting between Israel's military and Hamas began Monday.

The big picture: Israel began massing troops on its border with Gaza on Thursday, launching attacks from the air and ground as Hamas continued to fire rockets into Israel.

By the numbers: Where the earmarks are wanted

Expand chart
Data: House Committee on Appropriations; Chart: Danielle Alberti/Axios

The Dallas-Fort Worth area is being targeted for the largest collective earmark request in the country, according to a detailed breakdown of overall requests released by the House Appropriations Committee.

Why it matters: House appropriators are trying to balance bipartisan momentum for infrastructure investment with "pork-barrel" spending's checkered political history. The data dump is an effort to provide transparency for what are now termed "community project funding" requests.

Democrats open to user fees for infrastructure deal

President Biden sits Thursday with Sen. Shelley Moore Capito (R-W.Va.) as they discuss his $2.3 trillion infrastructure proposal. Photo: T.J. Kirkpatrick/The New York Times/Bloomberg via Getty Images

Some Senate Democrats are open to paying for a compromise infrastructure package by imposing user fees, including increasing the gas tax and raising money from electric car drivers through a vehicle-miles-traveled charge.

Why it matters: By inching toward the Republican position on pay-fors, some Democrats are bucking President Biden's push to offset his proposed $2.3 trillion plan by focusing only on raising taxes on corporations and the wealthy.