U.S. consumer credit surged in August on the strength of a big rise in credit card spending, according to data released by the Federal Reserve Friday.
Total consumer credit expanded by $12.2 billion, or a 5.9 percent annual rate, in the month compared to a newly-revised 4.7 percent increase in July. Last month, the Fed estimated that consumer credit expanded by tepid 3.7 percent in July.
But it was credit card spending that pushed the overall numbers. In August, the Fed said revolving credit surged by an annual rate of 8.1 percent, or $6.1 billion. The Fed also upwardly revised credit card spending in July to 7.4 percent from the 6.6 percent it reported last month.
In the past four months, credit card spending has been accelerating at well-above average paces. In June, credit card spending was up 6.4 percent and in May it increased at a 10.9 percent rate. Non-revolving credit, such as auto financing and student loans, increased by 4.7 percent in August after increasing 3.1 percent in July after the Fed revised the numbers.