The weakness in December reflected a big 7.8 percent decline in the category that includes credit card debt, and a 0.2 percent drop in the category that includes auto loans.
The cutback in consumer spending, which accounts for about 70 percent of economic activity, is the major reason the overall economy, as measured by the gross domestic product, contracted at an annual rate of 3.8 percent in the final three months of last year. That was the biggest drop in the GDP since 1982.
Consumers are retrenching in the face of soaring job layoffs. The Labor Department said Friday that employers slashed a net total of 598,000 jobs in January, the most since 1974, as the unemployment rate shot up to 7.6 percent. Both figures were worse than analysts expected.
Consumer spending fell in both the third and fourth quarters last year, the first back-to-back declines since the 1990-91 recession.
The three straight months of declines in consumer borrowing was the longest stretch of weakness since a seven-month plunge that ended in December 1991.
Part of the trouble is that banks, confronted with the worst financial crisis in seven decades, have been tightening their lending standards, making it harder for consumers to borrow.
Separately Friday, the Fed announced more details about a new credit program intended to provide support for various types of consumer loans, including credit cards, auto and student loans. But the Fed, which earlier indicated it would start the $200 billion program in February, said only that it would announce the exact starting date later this month.
The reduction in consumer spending has been tough on the nation's retailers. Many of the biggest chains on Thursday reported weak January sales, which followed the worst holiday season in four decades. Gap Inc., luxury retailer Saks and many others reported weaker-than-expected sales last month. Wal-Mart Stores Inc. and a few others beat expectations.
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