Consumer spending for June dropped 0.2% to $21.9 billion, the Commerce Department announced Tuesday.
The drop in consumer spending marked the first decline seen since September 2009.
Meanwhile, personal income was virtually flat, increasing 0.1% to $18.7 billion for the month, which was in line with estimates.
“Today’s personal income data show that consumers had a little more money in their pockets in June, as incomes increased and prices -- particularly gas prices -- dropped,” said Commerce Department chief economist Mark Doms. “With an agreement to raise the debt ceiling and avoid default in place, business and consumer confidence are more likely to strengthen, raising the outlook for greater economic growth and job creation in the third quarter.”