American consumers increased their borrowing in May at the fastest pace in six months, reflecting a sharp rebound in the category that includes credit cards.
The Federal Reserve reported Monday that total consumer borrowing rose by $18.4 billion in May, the strongest gain since a $25.1 billion increase in November. In addition, April’s gain of $8.2 billion, the weakest increase in nearly six years, was revised up to a more respectable increase of $12.9 billion.
Consumer borrowing is closely watched for signals it can provide about consumer spending patterns.
With the labor market continuing to churn out jobs and the stock market at record levels, economists believe that households will feel more confident about boosting their debt levels to support increased spending. Consumer spending accounts for 70 percent of economic activity.
The strength last month reflected a greater use of credit cards, which rose by $7.4 billion, much stronger than