WASHINGTON (AP) — Consumers increased their borrowing in January at the slowest pace in more than a year with borrowing on credit cards actually declining for the second time in the last three months.
The Federal Reserve reported Friday that consumer borrowing expanded $11.6 billion in January following a $17.9 billion gain in December. It was the smallest monthly increase since borrowing rose by $8.3 billion in November 2013.
Even though the January increase was more modest than the gains over the past year, it still pushed total borrowing to a fresh record of $3.33 trillion, an increase of 6.9 percent over the past year.
Borrowing in the category that includes credit cards actually declined by $1.16 billion in January following a $6.2 billion increase in December and a decrease of $537 million in November.
Borrowing in the category that covers auto loans and student loans rose $12.7 billion in January after a gain of $11.7 billion in December.
During the past year, borrowing in the category of auto and student loans has risen 8.3 percent while borrowing in the credit card category has risen a much slower 3.2 percent.
The auto and student loan category has been growing faster than credit card debt since the Great Recession of 2007-2009. That reflects in part the fact that many workers who lost jobs during the downturn decided to take out loans to go back to school and some students opted to stay in school longer because jobs were scarce.
The slowdown in credit card use could reflect greater caution among consumers about taking on debt to finance consumer spending. But economists are hoping that with job growth strengthening so much over the past year, consumers may step up their use of credit cards to finance purchases. That would give a boost to consumer spending and the overall economy.
The government said in a separate report Friday that U.S. employers added 295,000 jobs in February, the 12th straight monthly gain above 200,000.
The Fed's monthly report on consumer credit does not cover mortgages, home equity loans or other types of loans secured by real estate.