Consumer Spending Rises as Incomes Fall, Giving Mixed Picture of Economic Recovery

Pedestrians walk by a sign at an Old Navy store in San Francisco, Cali., on August 25, 2009. Justin Sullivan/Getty Images

American consumers increased their spending by 5.6 percent in June while personal income fell by 1.1 percent, giving a mixed picture of a U.S. economy struggling to sustain recovery momentum amid a surge of reported COVID-19 cases and lackluster jobs data.

Consumer spending is a major driver of the U.S. economy, accounting for around 70 percent of Gross Domestic Product (GDP), so the solid personal consumption expenditure number, released Friday by the Commerce Department, is an encouraging sign.