Record Surge in U.S. Consumer Borrowing in December

February 10, 2025 - 14:03

U.S. consumer borrowing experienced an unexpected spike in December, marking the largest increase ever recorded. Total credit soared by $40.8 billion, a significant jump from the previous month's increase of $5.4 billion. This surge is indicative of growing consumer confidence, as individuals appear more willing to take on debt for purchases, including big-ticket items and holiday spending.

The surge in borrowing was primarily driven by an increase in non-revolving credit, which includes loans for automobiles and education. This segment saw a notable rise, reflecting consumers' readiness to invest in essential goods and services. Meanwhile, revolving credit, which encompasses credit cards, also experienced a healthy uptick, suggesting that consumers are not only borrowing more but are also managing their finances in a way that allows for increased spending.

Economists are closely monitoring this trend, as it could signal a robust economic recovery. However, concerns remain about the sustainability of such high levels of consumer debt in the long term.