The reports on Tuesday showed growth assumed a more sluggish tone in the last months of the second quarter, setting up the July-September period for a lackluster performance.

Spending had edged up 0.1 percent in May, the Commerce Department said, and analysts had expected a matching gain in June.

A report from the National Association of Realtors showed the group's Pending Home Sales Index, based on contracts signed in June, tumbled to a historic low of 75.7 from 77.7 in May. Markets had expected the index to rise 0.6 percent.

"I think it's more evidence of the economy being a little bit slow right now. With GDP last week, the second quarter is a little bit slower than previously expected," said Giri Cherukuri, head trader at OakBrook Investments in Lisle, Illinois.

US stock indexes fell on the data, while prices for safe-haven Treasury debt prices rose. The US dollar fell against the Japanese yen.

Sluggish consumer spending contributed to a slower 2.4 percent economic growth pace in the second quarter, government data showed on Friday. The economy expanded at a 3.7 percent rate in the first three months of this year.

The economy is crawling out of its longest and deepest recession since the 1930s.

Treasury Secretary Timothy Geithner on Tuesday warned the unemployment rate could rise for a couple of months before subsiding.

"It's possible you're going to have a couple of months where it goes up," Geithner said on ABC's "Good Morning America."

"But what we expect to see ... is an economy that's gradually healing. Of course we want to do what we can to reinforce that process because it's not growing back as quickly as we'd like."

The unemployment rate is currently at 9.5 percent.