Consumer borrowing surges in March

By Jeremy M. Simon

A Federal Reserve report shows that consumer borrowing surged in March 2007 as U.S. consumers charged more purchases to their credit cards and took out additional car loans.

Overall, outstanding consumer credit climbed at a 6.7 percent annual rate, or $13.5 billion, in March, for the biggest rise since a 10.2 percent advance in November.  Consumer credit strengthened by an upwardly revised $5.6 billion in February.  

The March surge boosted total consumer debt to a record $2.43 trillion.

The result suggests that consumers are remaining resilient despite higher energy prices and a housing slump.

The use of revolving credit, mainly credit cards, spiked 9.2 percent in March on the heels of a 2.9 percent increase in February. 

Meanwhile, nonrevolving credit jumped 5.2 percent in March, up from a 2.7 percent gain in February.  Nonrevolving credit is used to finance such things as cars, vacations and education.

Analysts explained that in order to keep spending, consumers may be turning to credit cards amid tapped-out home equity loans and declining real estate values. 

Also, economists cited low unemployment as a catalyst for consumer spending, which makes up two-thirds of economic growth.  

Published: May 14, 2007

	Three most recent Research, statistics stories: Equifax report: Credit landscape looking up – Things are looking up within the credit landscape, says a report from the Equifax credit bureau. The second quarter of 2012 shows promising numbers -- with the exception of home finance ... How the CreditCards.com Weekly Credit Card Rate Report is made – CreditCards.com's Weekly Credit Card Rate Report features the national average annual percentage rate (APR) for new credit card offers, as well as national averages for offers of new cards in nine separate categories. Here's how we do it ... Child identity theft rising quickly, report says – According to an identity protection company based in Austin, child identity theft is on the rise and moving fast. Very fast ...

	CreditCards.com's newsletter Did you like this story? Then sign up for CreditCards.com’s weekly e-newsletter for the latest news, advice, articles and tips. It's FREE. Once a week you will receive the top credit card industry news in your inbox. Sign up now!