Credit, Economy and Financial News from TruckingFactor.com

Consumer Borrowing Continues to Decline

Consumer borrowing declined for the third consecutive month in December. The Federal Reserve reported that consumer credit dropped at an annual rate of 3.1%, as Americans cut spending in the face of a severe recession and mounting layoffs. The $6.6 billion followed an $11 billion drop in November that was the biggest monthly plunge on records going back to 1943. The figures for December reflected a 7.8% decline in the category that includes credit card debt, and a 0.2% dip in the category that includes auto loans. The cutback in consumer spending, which accounts for two-thirds of the nation's economic activity, is a big factor behind the Commerce Department's report that the nation's gross domestic product contracted at a 3.8% annual rate in the 4Q.

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Date Last Updated: 02/17/2009