WASHINGTON — Personal consumption rose .6% in June, a slight decrease in the rate of improvement since May, the Commerce Department reported today.
By contrast, in May spending rose .6%.
The department said that the rise of consumption spending continued to be fueled by the effects of the stimulus checks that the government sent to taxpayers from May through July. But the department also said that part of the increase in consumer spending–which accounts for about 70% of the Gross Domestic Product–was caused by inflation. If adjusted to remove price changes, consumer spending actually fell .2%.
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The data on personal income was also mixed.
Personal income grew .1% in June, compared with a 1.8% rise in May.
But disposable personal income –personal income minus taxes–fell 1.9% in June.
The tepid economic growth, as reflected in these numbers and last week's reports on unemployment and Gross Domestic Product, have prompted many economists to predict that the Federal Reserve's Open Market Committee will leave interest rates unchanged when it meets tomorrow.
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