Total consumer credit increased at a seasonally adjusted annual rate of 5.4% to hit $3.04 trillion, according to a Federal Reserve Consumer Credit report (link opens a PDF) released today.
After increasing at a seasonally adjusted annual rate of 4.1% for July, this month's credit picked up speed due primarily to an 8.0% seasonally adjusted annual rate increase in non-revolving credit (fixed installments such as car payments).
In absolute terms, analysts underestimated August's credit crunch, expecting a $12.9 billion increase instead of its actual $13.6 billion advance.
Revolving credit (no fixed number of payments such as credit cards) remains an area of concern for the economy. An increase in revolving credit can serve as a sign of more confident consumers, but August's 1.2% seasonally adjusted annual rate decrease is the third straight month of slides. That's the longest-lasting slump in three years.
The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.