WASHINGTON (AP) – American consumers stepped up their borrowing in August, taking on greater debt in a possible sign of optimism amid stable job growth.
Total consumer borrowing rose $25.9 billion in August to nearly $3.7 trillion outstanding, the Federal Reserve said Friday Consumer debt is rising at an annual pace of 8.5 percent, the strongest clip since September of last year.
Revolving credit, which covers credit cards, increased $5.6 billion, an annual gain of 7 percent. The category that includes auto and student loans jumped $20.2 billion, an increase of more than 9 percent from a year ago.
Consumers account for about 70 percent of U.S. economic activity. Their spending is among the few strengths that are helping to fuel the broader economy, which expanded at just 1.1 percent in the first half of 2016.
Anchoring the improved consumer borrowing has been a rising confidence in the job market.