Pace of Consumer Borrowing Down in July

Borrowing slowed in July from June’s torrid pace as Americans cut back both on using credit cards and buying autos and other personal items on credit. The Federal Reserve said consumer credit increased by a smaller-than-expected seasonally adjusted $9.4 billion in July, or 7.7% at an annual rate, the slowest pace in three months. Many analysts had expected borrowing to grow by $10 billion in July. Consumer credit in June grew by a whopping $14.7 billion, the biggest one-month gain since January, according to revised figures. That was more than the Fed previously estimated and translated into an annual growth rate of 12.2%. In July, total nonrevolving credit, such as loans for new cars, vacations and other big-ticket items, advanced by $5.7 billion at an annual rate of 8.2%. That was down from $9 billion and a 13.2% rate in June. Demand for revolving credit, such as that used for credit cards, rose $3.8 billion or at a 7.2% annual rate in July, down from $5.7 billion and a 10.9% rate in June.