No Increase Seen in Personal Income and Spending
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Consumer spending and personal incomes both remained flat in June after slightly rising the previous month in a sign that the economic turnaround may be weakening, according to government statistics released on Tuesday.
The Commerce Department reported that consumer spending in June was unchanged after growing by a revised 0.1 percent in May. The figure for May was revised down from a previously reported 0.2 percent rise.
Personal incomes were also unchanged in June as salaries and private wages fell, after the figure rose 0.3 percent in May.
Economists had expected to see a rise of 0.1 percent for spending and a 0.2 percent increase in June. A weak figure for personal incomes because of the expiration of unemployment benefits in early June. The benefits were extended last month, but the impact will not be seen until later reports.
Consumer spending is a closely watched figure, as it accounts for roughly 70 percent of the overall economy.
On Monday, U.S. Federal Reserve Chairman Ben Bernanke said that spending by consumers will grow in the coming quarters as wages increase and credit restrictions abate. He did caution that the jobs market is expected to remain weak, weighing on consumer confidence.
The report did say that the consumers saved more in June and May as Americans saved $725.9 billion at a national saving rate of 6.4 percent in June and 6.3 percent in May.
The high unemployment rate has been a weight on the economic recovery since emerging from the recession, and now economic indicators are showing a slowdown in the turnaround.
The Commerce Department reported that consumer spending in June was unchanged after growing by a revised 0.1 percent in May. The figure for May was revised down from a previously reported 0.2 percent rise.
Personal incomes were also unchanged in June as salaries and private wages fell, after the figure rose 0.3 percent in May.
Economists had expected to see a rise of 0.1 percent for spending and a 0.2 percent increase in June. A weak figure for personal incomes because of the expiration of unemployment benefits in early June. The benefits were extended last month, but the impact will not be seen until later reports.
Consumer spending is a closely watched figure, as it accounts for roughly 70 percent of the overall economy.
On Monday, U.S. Federal Reserve Chairman Ben Bernanke said that spending by consumers will grow in the coming quarters as wages increase and credit restrictions abate. He did caution that the jobs market is expected to remain weak, weighing on consumer confidence.
The report did say that the consumers saved more in June and May as Americans saved $725.9 billion at a national saving rate of 6.4 percent in June and 6.3 percent in May.
The high unemployment rate has been a weight on the economic recovery since emerging from the recession, and now economic indicators are showing a slowdown in the turnaround.
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