WASHINGTON — Americans took out $2.22 billion more in installment credit than they paid off in November as the growth in consumer borrowing slowed in the first full month after the October stock market crash, the government said Thursday.
The Federal Reserve said consumer debt grew at a 4.4% annual rate in November, after growth of $2.88 billion, a 5.7% increase, in October.
Consumer credit, spurred by a boom in auto sales in response to late-summer dealer incentives, grew at a 12.9% rate in September and at a 10.2% rate in August.
The slower growth in November came mainly in the auto loan and credit card categories.
Debt Closely Watched
Auto loans grew by $197 million--a 0.9% rate--in November, compared to $1.24 billion, or a 5.8% increase in October.
Borrowing on credit cards increased by $457 million--a 3.8% rate, compared to $1.44 billion, or a 12.2% increase a month earlier.
The category that includes cash loans from banks and credit unions that are not secured by real estate grew by $1.55 billion in November, climbing at a 10.5% rate. In October, that category increased $225 million, a 1.5% rate.
Loans for mobile homes increased $12 million after a $22-million decline in October.
Economists have been watching consumer debt levels for signs that Americans cut back spending in the wake of the Oct. 19 stock crash.
Sandra Shaber, an economist with the Futures Group, a Washington-based consulting firm, said the slow growth in November fits the general pattern for the year, although the stock crash probably played a role.
"Consumers are becoming much more reluctant to either use savings or credit to make major purchases," she said. Consumer debt grew at a sluggish 3.5% for the first six months of the year. She attributed the steep climb in late summer to the auto sales spurt.
Indications are that the pace will pick up a bit in December, she said. Car sales improved, and a last-minute boom in Christmas shopping has been reported.
The various changes in November left total consumer debt at $607.7 billion.