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Consumer spending up in June

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U.S. consumer spending rose 0.4 percent in June, slightly more than expected, despite personal incomes suffering their biggest decline in 4 1/2 years, Reuters reported Tuesday.

Market expectations were for a 0.3 percent spending increase in June.

However, spending actually fell 0.1 percent when adjusted for inflation after being flat in May. Spending fell at a 1.2 percent rate in the second quarter also, after it rose 0.6 percent in the January-March period, according to a government report Friday.

Personal incomes declined 1.3 percent in June, which was the biggest decrease since January 2005, and was worse than the market expectations of a 1 percent drop, according to a Reuters report.

The unwinding of one-time transfer payments from the Obama administration’s stimulus plan affected the rate of decline, according to Bloomberg. The stimulus plan boosted incomes 1.3 percent in May according to figures from the Commerce Department.