Con­sumer bor­row­ing up 7.73% in Oc­to­ber

Chattanooga Times Free Press - - BUSINESS - STAFF AND WIRE RE­PORTS

Amer­i­cans boosted their bor­row­ing by 7.73 per­cent in Oc­to­ber from a year ago, the largest in­crease in nearly a year as con­sumer spend­ing has helped fuel U.S. eco­nomic growth.

The Fed­eral Re­serve said Fri­day that con­sumer bor­row­ing rose by a sea­son­ally ad­justed $25.3 bil­lion in Oc­to­ber to a to­tal of $3.96 tril­lion. The Oc­to­ber in­crease was the most since Novem­ber 2017 and more than dou­ble the gain in the prior month.

Much of the in­crease was be­cause of a 10.75 per­cent jump in re­volv­ing credit, a cat­e­gory that in­cludes credit cards. Non­re­volv­ing credit — which in­cludes auto loans and stu­dent debt — rose 6.67 per­cent.

Economists and in­vestors mon­i­tor con­sumer bor­row­ing to judge the will­ing­ness of peo­ple to take on debt to fi­nance their pur­chases. Higher debt can sug­gest that peo­ple are con­fi­dent in their abil­ity to re­pay their loans.

Con­sumer spend­ing ac­counts for 70 per­cent of eco­nomic ac­tiv­ity.

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