American consumers spent the month of June saving their money rather than spending it.
According to the latest Personal Income and Outlays report from the U.S. Commerce Department, consumer savings increased significantly in the month of June as disposable income crept up slightly. In all, the nationwide personal savings rate climbed to 6.4 percent of after-tax income for the year’s sixth month. That rate is about three times that of the average for all of 2007 when the recession began, which was 2.1 percent.
The report also said that disposable income crept up to 0.2 percent in June after rising 0.4 percent in May. These two figures, when taken together, reveal that consumers both made and saved more, which hurt spending figures.
A separate report from the Commerce Department on consumer spending said that Americans spent more or less the same amount in June as the previous month despite the gains in income. Spending can often be viewed as an indicator of the country’s financial well-being because it makes up about 70 percent of all economic activity.