Consumer spending rose 0.1 percent in July after an upwardly revised 0.6 percent increase the previous month, the Commerce Department said. Personal income was up 0.1 percent as well, compared with a 0.3 percent rise in June.
Analysts had expected consumer spending to increase by 0.3 percent in July.
The figure was dragged down by a 0.2 percent decline in purchases of long-lasting durable goods, such as automobiles, appliances and computers, from the previous month, the Commerce Department said. It was the first drop in that category since March.
Purchases of services were flat. Purchases of nondurable goods, such as food and clothing, rose 0.9 percent in July after a 1.2 percent increase in June.
Consumers saved money at the same 4.4 percent rate in July as they did the previous month, but the reduction in the growth of spending helped keep inflation down.
Prices were up 0.1 percent in July compared with a 0.4 percent increase the previous month. Excluding volatile food and energy costs, prices also were up 0.1 percent in July after a 0.2 percent rise in June.
The figures put the inflation rate over the previous 12 months at 1.4 percent. That was up from 1.3 percent in June but still below the Federal Reserve's target of 2 percent annual price growth.
Fed policymakers are looking for signs that economic growth is improving in the second half of the year as they consider reducing their stimulus efforts as soon as September.
But some recent economic data have indicated that the anticipated pickup is not materializing.
Last week, the government reported a larger-than-expected drop in orders for durable goods, a key indicator of future manufacturing activity.
Friday's report showing slower growth in personal income could dampen consumer spending in coming months, although disposable income, adjusted for inflation, rose 0.1 percent in July after falling in June.
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