Borrowing up, but slowdown is predicted

WASHINGTON -- Consumers' borrowing grew in January, reflecting an increase in auto loans. The Federal Reserve reported yesterday that consumer credit rose at a 3.2 percent annual rate, up from December's 2.5 percent increase.

The gain was in line with the expectations of analysts, who believe debt levels will grow more slowly this year as consumers try to adjust their finances.

"The high debt levels that many consumers are carrying will be a factor governing their borrowing behavior," said Bill Hampel, chief economist at Credit Union National Association, a trade group. "Some of the steam will be coming out of consumer spending."

The category that includes auto loans rose at an annual rate of 4.4 percent in January, up sharply from December's 2.9 percent increase. However, the category of debt that includes credit cards slowed further in January, rising at a 1.1 percent rate, down from a 1.9 percent increase in December. Credit card debt had surged at a 14.7 percent rate in November.

Total consumer debt grew $6.4 billion, to a record $2.41 trillion, in January.