🇺🇸 U.S. Consumer Borrowing Slows Sharply in August, Raising Economic Concerns

U.S. consumer credit increased by just $363 million in August, the slowest pace in six months and dramatically below the expected $14 billion rise. This follows a strong $18.1 billion gain in July, marking a sharp deceleration.

The slowdown was driven by a $6 billion decline in revolving credit (primarily credit cards), the second largest drop in more than four years. Meanwhile, non revolving credit (such as auto and student loans) rose by $6.3 billion.

At the same time, the average interest rate on credit cards surged to 22.8%, the highest level this year and near an all time high.

The data highlights a cautious consumer backdrop, with rising borrowing costs starting to bite. As Americans pull back on spending, markets will be watching closely for signs of strain in household demand.

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