U.S. consumer spending rose more than expected in June as households bought a range of goods and services, suggesting consumption will likely remain strong after surging in the second quarter.
The Commerce Department said on Tuesday consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased 0.4 percent in June after a similar gain in May. Economists polled by Reuters had forecast consumer spending advancing 0.3 percent.
When adjusted for inflation, consumer spending increased 0.3 percent after climbing 0.2 percent in May.
The data was included in last week's second-quarter gross domestic product report, which showed that consumer spending rose at a 4.2 percent annual rate, the fastest in nearly two years. That jump accounted for almost all of the economy's 1.2 percent growth pace during the period.
While the second-quarter's robust pace of consumer spending will probably not be sustained, economists are optimistic that spending will remain solid, underpinned by steadily increasing wages as the labor market tightens, as well as rising house and stock market prices.