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Economy in Brief

U.S. Consumer Credit Usage Moderates Sharply in January
by Tom Moeller  March 7, 2022

• Revolving credit balances decline.

• Nonrevolving credit usage weakens.

Individuals' use of credit weakened in January. Consumer credit outstanding increased $6.8 billion (6.1% y/y) during January following a $22.4 billion December rise, revised from $18.9 billion. A $21.5 billion January rise had been expected in the Action Economics Forecast Survey. The ratio of consumer credit outstanding-to-disposable personal income held steady at 24.3% in January, the highest level since March 2020.

Revolving consumer credit balances slipped $0.2 billion (+8.2% y/y) in January after growing $4.3 billion in December. Credit provided by depository institutions (90% of the total and mostly credit card debt) rose a greatly accelerated 9.3% y/y. Credit union borrowing (6% of the total) also surged 7.4% y/y. Nonfinancial business loans (2% of the total) held steady y/y. The value of finance company loans (1% of loans) declined 19.1% y/y.

Nonrevolving credit usage grew $7.1 billion (5.5% y/y) in January following an $18.1 billion December increase. Federal government borrowing, which issues over 40% of nonrevolving credit, grew a lessened 3.7% y/y. Depository institution loans (26% of credit) grew an accelerated 9.1% y/y. Finance company borrowing (17% of loans) moderated to 4.6% y/y. Credit union loans (14% of the total) increased 6.2% y/y, the quickest since 2018.

These Federal Reserve Board figures are break-adjusted and calculated by Haver Analytics. The breaks in the series in 2005, 2010 and 2015 are the result of the incorporation of the Census and Survey of Finance Companies, as well as changes in the seasonal adjustment methodology. The consumer credit data are available in Haver's USECON database. The Action Economics figures are contained in the AS1REPNA database.

 Consumer Credit Outstanding (M/M Chg, SA) Jan Dec Nov Jan y/y 2021 2020 2019
Total ($ bil) 6.8 22.4 39.3 6.1% 6.0% -0.3% 4.6%
   Revolving -0.2 4.3 21.0 8.2 7.0 -11.1 3.6
   Nonrevolving 7.1 18.1 18.3 5.5 5.6 3.6 5.0
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