Consumer Debt Rises $1 Billion During Month

Americans took on $6.25 billion more in installment debt than they paid off in July, up by more than $1 billion from June, the government said Tuesday.

The Federal Reserve Board said the July increase was above the revised June debt gain of $5.23 billion but was well below the May increase of $9.04 billion.

The annual rate of growth in consumer debt was 15% in July, well below the average gains earlier in the year. Consumer debt advanced at an 18.9% annual rate from April through June.

Consumer spending has been a key driving force behind the current recovery. However, some economists have questioned how long these advances will last given the growing consumer debt burden.

The July credit report gave these details:

- Auto loans increased by $2.37 billion, down from a $2.69-billion gain in June.

- Cash loans from banks and other short- and medium-term personal debt rose by $2.69 billion in July, about the same as the $2.64-billion June increase.

- The category that includes credit card debt rose by $856 million in July after dropping by $73 million in June.