Consumers Continue to Curb Credit Purchases

Growth in consumer borrowing in the United States lapsed in August to the slowest pace in three months despite a rebound in auto lending after the end of the General Motors strikes, Federal Reserve figures show. Total consumer installment credit increased by $4.6 billion at a 4.4% annual rate in August, down from a revised 5.2% pace in July and 8.4% in June, the Fed said. Auto loans climbed by $3.9 billion at a 10.8% annual rate--the strongest for any month this year--following a $2.2-billion gain in July, an annual rate of 6.2%. Credit card use picked up, as debts grew by $2.2 billion at a 4.8% rate in August, reversing July’s $2.2-billion decline. But credit such as consumer bank loans used to pay education bills or to buy mobile homes, though not mortgage loans, fell by $1.4 billion at a 5.8% annual rate in August. In July, this category had climbed by $5.5 billion, a 22.8% rate.