National News

Aug 29, 2014 9:00 AM by Associated Press

US consumer spending dips 0.1 percent

WASHINGTON (AP) - U.S. consumer spending fell in July, with a drop in auto purchases accounting for most of the weakness. Income growth also slowed in July.

The Commerce Department says consumer spending edged down 0.1 percent last month after a 0.4 percent increase in June. It was the first decline in spending since January. Income growth slowed to a 0.2 percent rise in July, the weakest showing in seven months.

The fall in spending came primarily from a decline in auto sales, which took a breather in July after posting big gains in recent months, although spending in other areas was also weak.

Consumer spending accounts for 70 percent of economic activity, so it needs to recover for the economy to keep its momentum in the second half of the year.

(Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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