Washington, August 3-- Personal income grew modestly in June, while consumer spending took its biggest drop since September 2001.
Personal income rose 0.2% in June, after rising an unrevised 0.6% in May, the Commerce Department said Tuesday. Personal consumption decreased 0.7%, after rising an unrevised 1.0% in May. The decrease was the largest since September 2001's 1.2% drop.
The numbers were a mixed surprise. A Dow Jones Newswires-CNBC survey of 21 economists had forecast personal income would rise 0.2% and spending fall 0.1%.
Disposable personal income, or income after taxes, climbed 0.2% in June, following a 0.5% advance in May.
Spending on durable goods -- designed to last three years and longer -- plummeted 5.9%, after a 3.7% increase in May. Non-durable goods fell 0.3%, after rising 1.4% in May. Spending on services grew 0.2% in June.
Personal saving as a percentage of disposable personal income was 2.0% in June, up from 1.2% in the prior month. It was the largest savings rate since August 2003's 2.2%
Two inflation gauges in the report held at the same rate.
A price index for personal consumption expenditures excluding food and energy rose in June from the prior month at a 0.1% rate -- the same as the 0.1% month-to-month increase in May from April.
Year over year, personal consumption expenditures less food and energy rose 1.5% in June from the same month in 2003. The year-over-year climb in May was 1.5%.
