The U.S. Commerce Department released personal spending and income figures on Thursday. Personal spending was up 0.4% in March, exceeding expectations for 0.3% gain, after a 0.2% increase in February. February's figure was revised up from a 0.1% rise.

Consumer spending makes more than two-thirds of U.S. economic activity.

The increase was driven by higher purchases of durable goods (like automobiles), which climbed 1.8%.

Spending on goods rose 1.0% in March, while spending on services gained 0.2%.

Personal income was flat in March, missing expectations for a 0.2% increase, after a 0.4% rise in February. It was the weakest reading since December 2013.

The personal consumption expenditures (PCE) price index excluding food and energy rose 0.1% in March, after a 0.1% gain in February.

On a yearly basis, the PCE price index excluding food and index rose 1.3% in March, after a 1.4% increase in February.

The PCE index are below the Fed's 2% inflation target. The PCE index is the Fed's preferred measure of inflation.