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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowBorrowing by Americans fell in January for the first time in five months, as a big drop in the use of credit cards offset increases in auto loans and student loans.
The Federal Reserve reported Friday that consumer borrowing fell by $1.3 billion in January, the first drop since a $9 billion decline in August.
The weakness came from a $9.9 billion decline in borrowing in the category that covers credit cards. It marked the fourth straight decline in that category and was the biggest drop since a $10.8 billion fall in August.
The category that covers auto and student loans posted an $8.6 billion increase in the first month of 2021, following an even bigger gain of $11.6 billion in December.
Consumer borrowing is closely watched for indications about Americans’ willingness to take on more debt to finance their spending, which accounts for two-thirds of U.S. economic activity.
Since the pandemic hit a year ago, millions have lost their jobs and households have grown more cautious, boosting their savings levels as a hedge against economic uncertainty.
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