September 9, 2008

U.S. Consumer Credit Grows at Slowest Pace in 7 Months

U.S. consumer credit grows at slowest pace in 7 months

WASHINGTON, Sept. 8 (Xinhua) -- U.S. consumer credit rose at an annual rate of 2.1 percent in July, the slowest pace since a 1.9 percent gain last December, the Federal Reserve reported Monday.

The 2.1 percent growth rate followed a revised 5.1 percent pace in June and pushed the nation's total consumer credit up slightly to 2.587 trillion dollars in July.

The U.S. central bank does not include loans secured by real estate, such as mortgages, in its measurement of consumer debt.

For July, consumer borrowing in revolving loans, a category that includes primarily credit card debt, increased by 4.8 percent at an annual rate, up from a 3.5 percent gain in the previous month.

Demand for nonrevolving credit used to finance cars, vacations, education and other things, however, gained by a tiny 0.5 percent, down sharply from a brisk 6.1 percent advance in June.

Automakers reported that demand for cars fell in July to the lowest level in 16 years.

Consumer credit reflects the situation of consumer spending, which accounts for two-thirds of overall U.S. economic activity and is a major force driving the economy to grow.

The central bank's report also showed that U.S. consumer credit in the April-to-June period had been revised to an increase of 4.4 percent at an annual rate, compared with growth paces of 4.9 percent previously estimated and 5.3 percent in the first quarter of this year.

(c) 2008 Xinhua News Agency - CEIS. Provided by ProQuest LLC. All rights Reserved.