WASHINGTON -- Consumers reduced their borrowing for the seventh straight month in August, as households trim spending and banks reduce credit card limits.
The Federal Reserve says total consumer debt outstanding fell in August by $12 billion, a 5.8 percent annual rate.
That follows a downwardly revised drop of $19 billion, or 9.1 percent, in July. Wall Street economists expected a $10 billion decline in August.
Most of the cut was in credit card and other revolving debt, which dropped $9.9 billion, or 13.1 percent.
Auto loans and other debt fell by $2.1 billion, or 1.6 percent.
Consumers are spending less and saving more in response to widespread job losses, stagnant wages and dwindling home values. Banks also are reducing credit limits on millions of credit cards.
First Published: October 8, 2009, 4:00 a.m.
