U.S. consumers' personal income continues rising while spending growth slowed in June, the latest sign of Americans' cautious consumption attitude, the Commerce Department reported on Monday.
In the month, personal income increased 0.4 percent following the same growth in May. Personal spending rose 0.2 percent, the smallest gain since February. In May, personal spending grew 0.7 percent.
Personal saving rate continued rising in the month, reflecting consumers' caution in spending. The personal saving rate rose to 4. 8 percent in June from 4.6 percent in May.
The price index for the personal consumption expenditure (PCE), a gauge for the inflation level preferred by the Federal Reserve, increased 0.3 percent year on year, slightly higher than the 0.2 percent growth in May. The PCE price index, excluding volatile food and energy, increased 1.3 percent from a year ago, the same growth in May.
Both the headline and core PCE index have been below the central bank's 2 percent target for years. Federal Reserve Chair Janet Yellen said in her recent testimony to the Congress that low oil prices and ongoing employment gains should continue to bolster consumer spending.
She reiterated that Fed officials expected that inflation will move gradually back toward the central bank's 2 percent objective, as the effects of transitory factors such as low oil prices and strong dollar dissipate while the labor market further improves.