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Economy in Brief

U.S. Consumer Credit Outstanding Growth Slows
by Tom Moeller  April 9, 2012

Reported late Friday, consumer credit outstanding increased $8.7B (4.3% y/y) during February after an $18.6B January rise, revised from $17.8B. A $12.0B increase had been expected by Action Economics. It raised credit usage by 4.3% during the last twelve months and at an 11.3% annual rate during the last three.

Non-revolving credit usage, which accounts for nearly two-thirds of the total, jumped another $11.0B (6.1% y/y) in February and at an 11.2% rate during the last three months. Loans by the federal government to students rose 29.9% y/y. Loans by commercial banks rose 3.2% y/y and loans to nonfinancial business rose 2.7%. Credit union borrowing ticked up 0.6%. To the downside, savings institution lending fell 1.4% y/y and finance company loans dropped 4.1% y/y. Pools of securitized assets were off 5.7% y/y.

Consumers' revolving credit balances fell another $2.2B (+0.7% y/y) during February and were off at a 0.7% rate during the last three months. Credit issuance by savings banks rose 14.8% y/y, finance company lending increased 8.2% y/y while credit union loans gained 4.0%. Pools of securitized assets were off 3.0% y/y. Commercial bank lending fell a steady 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.

Consumer Credit Outstanding
(M/M Chg, SAAR)
Feb Jan Dec Y/Y 2011 2010 2009
Total $8.7B $18.6B $16.3B 4.3% 3.6% -1.7% -4.4%
  Revolving -2.2 -3.0 3.7 0.7 0.4 -7.5 -9.6
  Non-revolving 11.0 21.5 12.6 6.1 5.1 1.5 -1.2
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