Global| Dec 05 2014U.S. Consumer Credit Usage Tapers Off
by:Tom Moeller
|in:Economy in Brief
Summary
Consumer credit outstanding increased $13.2 during October (6.7% y/y) following a revised $15.4 billion September rise, initially reported as $15.9 billion. It was the slowest rate of gain since December. Expectations were for a $16.5 [...]
Consumer credit outstanding increased $13.2 during October (6.7% y/y)
following a revised $15.4 billion September rise, initially reported as $15.9 billion.
It was the slowest rate of gain since December. Expectations were for a $16.5 billion increase, according to the Action
Economics Forecast Survey. During the last ten years, there has been a 54%
correlation between the y/y growth in consumer credit and the y/y growth in
personal consumption expenditures.
Usage of non-revolving credit eased to $12.3 billion (8.1% y/y), the weakest rise this year. Federal government loans increased 15.6% y/y. These constitute roughly one-third of total non-revolving credit. Finance company lending (27% of the total) edged 0.3% higher y/y. Bank borrowing (26% of the total) rose 6.9% y/y and borrowing at credit unions (10% of the total) advanced 13.1% y/y. Nonprofit & educational institution loans (3% of the total) declined 9.0% y/y. Nonfinancial business loans (1% of the total) were unchanged y/y.
Revolving credit outstanding improved $0.9 billion (3.1% y/y). Commercial bank & savings institution lending (81% of the total) increased 4.6% y/y. Finance company balances (8% of the total) declined 8.9% y/y while borrowing from credit unions (5% of the total) gained 8.1% y/y. Nonfinancial business accounts (3% of the total) remained unchanged y/y and securitized credit card balances (4% of the total) fell 5.0% y/y.
These Federal Reserve Board figures are break-adjusted and calculated by Haver Analytics. There is a break in the credit outstanding data from November 2010 to December 2010 due to the Fed's benchmarking process. Benchmark estimates are based on the Census of Finance Companies (CFC) and the Survey of Finance Companies (SFC) conducted in 2010 and 2011, respectively. 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) | Oct | Sep | Aug | Y/Y | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|---|---|
| Total | $13.2 bil. | $15.4 bil. | $13.6 bil. | 6.7% | 6.0% | 6.1% | 4.1% |
| Revolving | 0.9 | 1.4 | -0.3 | 3.1 | 1.3 | 0.6 | 0.2 |
| Nonrevolving | 12.3 | 14.0 | 13.8 | 8.1 | 7.9 | 8.5 | 5.9 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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