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Economy in Brief

U.S. Consumer Credit Outstanding Continues Rising
by Tom Moeller  March 8, 2012

Reported late yesterday, consumer credit outstanding jumped another $17.8B (4.3% y/y) during January after a $16.3B December increase, revised from $19.3B. A $10.0B increase had been expected by Action Economics. It raised credit usage by 4.3% during the last twelve months and at a 9.1% annual rate during the last three.

Non-revolving credit usage, which accounts for nearly two-thirds of the total, surged another $20.7B (6.0% y/y) in January and at an 11.7% rate during the last three months. Loans by the federal government to students rose by one-third y/y. Loans by commercial banks rose 2.5% y/y and loans to nonfinancial business rose 2.2%. Credit union borrowing was unchanged. To the downside, savings institution lending fell 1.9% y/y and finance company loans dropped 3.8% y/y. Pools of securitized assets were off 11.6% y/y.

Consumers' revolving credit balances fell $2.9B (0.8% y/y) during January but rose at a 3.7% rate during the last three months. Credit issuance by savings banks rose 13.9% y/y, finance company lending increased 9.2% y/y while credit union loans gained 3.9%. Pools of securitized assets were off 2.8% y/y. Commercial bank lending fell 1.2% y/y while nonfinancial business credit remained unchanged y/y.

During the last ten years, there has been a 52% correlation between the y/y change in credit outstanding and the change in personal consumption expenditures, although the correlation recently has weakened considerably. The credit figures are the major input to the Fed's quarterly Flow of Funds accounts for the household sector.

The consumer credit data are available in Haver's USECON database. The Action Economics figures are in the AS1REPNA database.

What Your Credit Report Says About You from the Federal Reserve Bank of Philadelphia is available here.

Consumer Credit Outstanding
(M/M Chg, SAAR)
Jan Dec Nov Y/Y 2011 2010 2009
Total $17.8B $16.3B $20.0B 4.3% 3.6% -1.7% -4.4%
  Revolving -2.9 3.7 6.5 0.8 0.4 -7.5 -9.6
  Non-revolving 20.7 12.6 13.5 6.0 5.1 1.5 -1.2
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