U.S. consumer spending rose by 0.5 percent in May, the same pace as in the previous month, the Commerce Department reported Friday.

The report showed that consumer spending on durable goods, items expected to last at least three years such as cars and appliances, increased by 0.4 percent in May, rebounding from a 0.6 percent drop in April.

Meanwhile, spending on non-durables such as food and clothes jumped by 1.4 percent, compared to an increase of 0.5 percent in April. Spending on services also climbed up by 0.1 percent, but the gain was much smaller than the 0.8 percent rise in the prior month.

On the other hand, personal income, the fuel for future spending, was up 0.4 percent in May. That was an improvement from the 0.2 percent drop reported for April.

Americans' disposable personal income, or after-tax income, increased by 0.4 percent in May, compared to a 0.3 percent decline in April.

With spending outpacing income growth, the personal savings rate -- savings as a percentage of disposable personal income -- fell to a negative rate of 1.4 percent in May, the worst showing since August 2006.

A negative savings rate means that Americans not only spend all of their after-tax income but have to dip into previous savings or increase borrowing.

Consumer spending accounts for two thirds of overall economic activity and is a major force pushing the economy to grow.

Source: Xinhua