US consumer debt has hit a record high. (File photo)
The US Federal Reserve says American consumer debt has hit a record high reaching USD 2.7 trillion, with a dramatic increase within car and student loans.
The figure was released on Friday showing consumers increased their borrowing by USD 14.2 billion in October.
The usage of credit cards amounted to USD 3.4 billion of the total sum.
The largest increase was within the category auto and student loans, which rose by USD 10.8 billion during the period making it 22 percent higher than the amount registered in July of 2008.
The rise within student loans is a reflection that many unemployed Americans are going back to school to receive new careers. About 70 percent of the country’s economic activity comes from consumer spending.
With unemployment remaining high and households not having incomes to spend, economists do not see a change in the near future.
The unemployment rate is 7.9 percent, according to official sources, however many American economists believe the true rate is above 20 percent.