U.S. consumer debt outstanding in January posted the smallest gain since July 2012 as American households reduced their credit card balances, Bloomberg News reported yesterday. The $8.8 billion advance last month followed a revised $14.8 billion gain in the prior month, Federal Reserve figures showed Tuesday. Revolving debt, which includes credit cards, declined by the most since December 2012 as households got to work reducing balances that had built up over the holiday-shopping season. The figures also help explain a moderation in consumer spending so far in the first quarter. At the same time, the pace of non-revolving credit picked up in January from a month earlier on financing of big-ticket purchases such as cars and school loans. Revolving debt, which includes credit cards, dropped $3.8 billion after a $3.6 billion increase, the Fed’s report showed. Non-revolving debt, such as that for college tuition and the purchase of vehicles and mobile homes, climbed $12.6 billion after an $11.2 billion increase. Lending by the federal government, which is mainly for student loans, rose by $27.3 billion in January before adjusting for seasonal variations.
