United States witnessed a rise in consumer spending in July owing to government's "cash for clunkers" program.

As per a number of analysts, government stimulus programs like "cash for clunkers' are boosting economic growth in the final half of the year.

Figures compiled by the Commerce Department revealed that consumer spending in July edged up 0.2 per cent.

But, the Commerce Department said personal incomes were unchanged in July. Out of the past ten months, July was the eighth in which incomes have either fallen or failed to grow.

Cash for clunkers program ended Monday. Now government is pondering over a similar program for appliances to boost their sale.

However, many economists worry that soaring rate of unemployment along with flat incomes will hinder consumer spending, which accounts for around 70 per cent of the total economic activity.

Guy LeBas, chief economist at Janney Montgomery Scott LLC, said, "We can't have a sustained recovery without growth in consumer spending."

Consumer sentiment index, which had soared to 70.8 in June, dipped to 65.7 in August from 66.0 in July.

It may be noted here that with a view to aid the economy, the Federal Reserve has slashed the key interest rate to a record low.