NEW YORK (CNN/Money) - Consumer spending rose in April but at a slower pace than in March, a government report showed Friday, but a new surveyed showed consumers are getting less confident about the economy.
The government report showed personal spending rose 0.3 percent, compared with a revised 0.5 percent increase in March. Economists surveyed by Briefing.com forecast a 0.2 percent gain for April.
Consumer spending is closely watched since it fuels two-thirds of the nation's economy.
Personal income increased 0.6 percent in the month, following a 0.4 percent rise in March. Briefing.com's forecast was for a 0.5 percent rise.
Meanwhile, consumer confidence fell in May, confounding economists' forecasts for a steady reading, a survey from the University of Michigan showed Friday, Reuters reported.
The final survey of consumer confidence for May showed its sentiment index fell to 90.2 from April's final reading of 94.2, Reuters said, citing people who saw the subscription-only report. Economists polled by Reuters had looked for an unchanged reading of 94.2.
The current conditions index dropped to 103.6 from April's final reading of 105, while the expectations index declined to 81.6 from April's final reading of 87.3, the news agency said.
Inflation muted
The good news for investors in Friday's economic data came in the price index that was part of the consumer spending and personal income report.
The measure of prices paid by consumers showed only a 0.1 percent rise compared with a 0.3 percent rise in March. Excluding volatile food and energy prices the index also showed a 0.1 percent increase, compared to a 0.2 percent gain in that measure in March.
Inflationary pressure in economic reports is being closely watched by investors who are trying to gauge when the Federal Reserve will start raising interest rates -- at its June or August meeting.
The lower inflation report helped Treasury bond prices recover from early losses, but a strong reading on Chicago-area manufacturing sent them lower again.
Concerns that the Fed is going to move sooner to raise rates due to new signs of inflation in other reports has hurt both bond and stock prices the last two weeks.
-- Reuters contributed to this story.
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