Consumers keep borrowing

People borrowed with undiminished gusto in September, highlighting the Reserve Bank's limited success, so far, in reining in the growth of household debt.

Mortgage debt increased $1.5 billion to $116 billion compared with $100 billion in September last year.

The pace of credit growth is quickening despite periodic warnings from Governor Alan Bollard about the risks associated with the housing boom, and a series of interest rate hikes designed in part to curb the spillover effects on consumer spending.

Bank of New Zealand economist Dean Ford said household debt rose 1.4 per cent in September, adjusted for seasonal effects, an increase from four-monthly increases of 1.1 per cent - already way too fast.

And last month's annual increase of 16 per cent is an acceleration from 15.7 per cent in the year to August.