Consumer borrowing increases in January

/ Source: The Associated Press

Consumers borrowing increased in January, reflecting an increase in auto loans.

The Federal Reserve reported Wednesday that consumer credit rose at a 3.2 percent annual rate in January, up from December’s 2.5 percent increase.

The gain was in line with expectations of analysts who believe faster wage growth would give consumers the confidence to take on more debt.

The category that includes auto loans rose at an annual rate of 4.4 percent in January, up sharply from December’s 2.9 percent increase.

However, the category of debt that includes credit cards slowed further in January, rising at a 1.1 percent rate, down from a 1.9 percent increase in December. Credit card debt had surged ahead at a 14.7 percent rate in November.

The increased borrowing pushed total consumer debt up by $6.4 billion to a record $2.41 trillion in January.

The Federal Reserve measure of consumer borrowing does not include mortgages or other loans secured by real estate.