WASHINGTON – U.S. consumers increased their borrowing in August in the category that covers auto loans and student loans but cut back on their credit card borrowing.
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The Federal Reserve says that overall borrowing rose $13.5 billion in August following a revised $21.6 billion increase in July. The gains have pushed total consumer debt to a record level of $3.25 trillion.
The category that includes auto loans and student loans increased $13.7 billion in August while the category that covers credit card debt declined by $208 million, the first drop in this area in six months.
Rising levels of consumer borrowing are viewed as a good sign that with strong employment growth, consumers are more confident about taking on debt to finance purchases. Consumer spending accounts for 70 percent of economic activity.