US Consumer Borrowing Rose Most Since Late 2022 in March

U.S. consumer borrowing rose in March by the most since late 2022. The increase reflected gains in both non-revolving credit, such as auto and student loans, and revolving credit in the form of higher credit-card balances. That marked the strongest pace of growth in more than two years.

Non-revolving credit accounted for most of the increase, while revolving credit also contributed with a pickup in balances carried on credit cards. The data come as households continue to manage debt levels following a period of elevated inflation and interest rates.

Consumer credit outstanding reached $4.74 trillion at the end of March, according to the central bank.

Non-revolving credit, which includes loans for vehicles, education and other fixed-term borrowing, surged during the month. Revolving credit, consisting primarily of credit cards, also posted an increase after showing more moderate growth in prior months.

The pickup in credit-card balances suggests households turned to plastic to cover some spending even as borrowing costs remained high. Banks and other lenders have tightened standards on some types of consumer loans in recent quarters.

The consumer credit report is watched for signals about household financial health and willingness to take on new debt. Stronger borrowing can support consumer spending, which accounts for more than two-thirds of U.S. economic activity. Future releases will show whether the March acceleration continues or if higher interest rates begin to weigh more heavily on household borrowing.