US consumer credit his new record of $3.47 trillion in August, led by auto and student debt
Posted Oct 7, 2015 1:11 pm.
Last Updated Oct 7, 2015 2:00 pm.
This article is more than 5 years old.
WASHINGTON – U.S. consumer borrowing advanced at a solid pace in August, as Americans took out more auto and student loans.
The Federal Reserve said Wednesday that consumer borrowing rose by $16 billion in August, pushing the total to a fresh record of $3.47 trillion.
The August advance was slightly below the July gain of $18.9 billion. In June, credit had soared by $27.2 billion, the largest increase since November 2001.
Borrowing for car and student loans expanded by $12 billion in August. Borrowing in the category that covers credit cards rose by $4 billion.
Economists are forecasting that consumer spending, which accounts for 70 per cent of economic activity, will remain strong in the coming months as households remain willing to take on more debt.
A strong consumer sector will help to offset weakness in other parts of the economy. Manufacturing and export sales have been hurt by increased weakness overseas and a higher dollar, which makes U.S. products less competitive on foreign markets.
The overall economy, as measured by the gross domestic product, expanded at a robust rate of 3.9 per cent in the April-June quarter. But many economists believe growth slowed sharply in the July-September quarter to perhaps as low as 1.5 per cent, reflecting the impact of a lacklustre global economy.
