Richmond Times-Dispatch Weekend

U.S. consumer borrowing posts another strong gain in March


U.S. consumer borrowing rose by a strong $25.8 billion in March, the second month in a row of sizable gains and a further indication that the economic recovery is picking up steam.

The March gain reported Friday by the Federal Reserve followed an even larger $26.1 billion consumer-borrowing rise in February. The two monthly increases were the biggest gains since a $26.8 billion increase in December 2019, before the pandemic hit.

The March borrowing advance reflected a $6.4 billion increase in the category that includes credit cards and a $19.4 billion rise in the category that covers auto loans and student loans.

Consumer borrowing is watched closely for signals it can send about households’ willingnes­s to borrow to finance their spending. Consumer spending accounts for two-thirds of U.S. economic activity.

The February and March increases in the credit card category followed four consecutiv­e months in which credit card borrowing had fallen. Even with the recent gains, total debt in the credit card category of $980 billion is down 9% from the level in March 2020.

Total debt in the Fed’s monthly report stood at a record $4.24 trillion in March.

The Fed’s report does not cover mortgage loans or any other debt secured by real estate such as home equity loans.

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