WASHINGTON – U.S. consumer spending rose solidly in June as income advanced at the fastest pace in nearly two years on the back of big pay gains, helping cash registers ring out the second quarter on an upbeat note, the government said on Friday.
Consumer spending rose 0.5 percent in June after holding steady in May, the Commerce Department said. Spending in May had originally been reported as down 0.1 percent.
Personal income in June increased 0.6 percent, its biggest advance since a matching rise in July 2000. The June income gain followed a 0.4 percent May rise, a tick stronger than originally reported.
Behind the strong rise in income was a 0.6 percent increase in wages and salaries -- the largest income component. It was the strongest pay performance since an identical increase in January 2001.
The report was very close to Wall Street forecasts. Economists polled by Reuters had expected a 0.5 percent gain in personal income, with spending up 0.6 percent.