The US Department of Commerce has recorded a 0.2 per cent decline in consumer spending in June.
The cut in spending is the first since September 2009 and comes in the same month that US income growth (0.1 per cent) was reduced to its slowest rate in nine months.
These latest figures mean consumer spending moved up at an annual rate of only 0.1 per cent in the second quarter after climbing 2.1 per cent in the first three months of the year.
The news has inflamed doubts about the state of the nation's economic recovery, which was expected to gather pace in the third quarter, and US stocks fell in the aftermath of the announcement.
