increased their borrowing by a solid amount in September. But the gain was less
than half the big August surge as borrowing in the category that includes
credit cards fell.
borrowing rose by a seasonally adjusted $10.9 billion following a jump of $22.9
billion in August, the Federal Reserve reported Wednesday. The August gain had
been the strongest increase in nine months.
advance was below economists' expectations for a $16.5 billion gain. The
category that covers auto loans and student loans rose a solid $11.2 billion.
The category for credit cards fell by $311.6 million after having risen $4.6
billion in August.
borrowing is closely tracked for signs of consumers' willingness to take on
more debt to finance their purchases.
spending accounts for 70 percent of economic activity and has been especially
important in driving growth in recent months. The economy, as measured by the
gross domestic product, grew at an annual rate of 3.5 percent in the
July-September quarter, helped by the biggest burst in consumer spending in
nearly four years. That GDP gain followed an even faster 4.2 percent growth
rate in the second quarter of this year.
unemployment down to 3.7 percent, the lowest level in nearly five decades, and
consumer confidence high, analysts believe consumer spending will continue to
provide a strong underpinning for growth.
rise in borrowing, which was a 3.3 percent increase at an annual rate, pushed consumer
credit to a fresh record of $3.95 trillion.