US consumers increased the pace of their spending in July by double the increase in their incomes, driving the monthly savings rate to its lowest level on record, government data show.

The Commerce Department yesterday reported a 0.3 per cent increase in personal incomes in July to a $8,285.1 billion annual rate, a rise overwhelmed by a 0.6 per cent jump in personal spending in July to a $6,661.2 billion annual rate.

July's spending increase surpassed June's revised 0.4 per cent rise. It was the largest increase since February's 1.2 per cent gain and pushed down the monthly savings rate to -0.2 per cent, its lowest level since monthly records began in 1959.

The latest data are likely to revive concerns among policymakers about the threat America's low savings rate poses to future retirement needs and the US economy's long-term growth and stability.