US consumer spending, incomes cool in June

US consumer spending and incomes cooled in June after getting a boost a month earlier from a vast emergency economic stimulus, a government survey showed Monday.The Commerce Department reported that consumer spending rose 0.6 percent in June while incomes rose a mild 0.1 percent, marking the weakest rise in incomes since April 2007.Both readings were nonetheless stronger than expected as most economists had forecast that spending increased 0.5 percent and incomes contracted 0.1 percent.Spending had accelerated at a 0.8-percent clip in May while incomes rose a revised 1.8 percent. Both measures received a shot in the arm from the government's 168-billion-dollar economic stimulus, which was stuffed with one-off tax rebates.The administration of President George W. Bush approved the stimulus to fire up US economic growth which has slowed amid a continuing housing slump, a credit crunch and surging fuel prices.The monthly snapshot is followed closely by the financial markets because consumer spending is the main driver of US economic activity.Although world oil prices have declined slightly in recent weaks from record peaks over 147 dollars a barrel, the report showed a surge in its inflation readings.The PCE (personal consumption expenditures) price index rose 0.8 percent in June -- marking its strongest monthly gain since 1997 -- following a gain of 0.5 percent in the prior month.The core PCE rate, which excludes volatile food and energy costs, increased 0.3 percent, marking its biggest increase since September of last year.

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[Source: Business News]