U.S. Consumer Credit Usage Strengthens in February
by:Tom Moeller
|in:Economy in Brief
Summary
- Revolving credit balances surge.
- Nonrevolving credit usage also strengthens.
Consumer credit outstanding increased by a record $41.8 billion (6.5% y/y) during February after rising $8.9 billion in January, revised from $6.8 billion. A $16.8 billion February rise had been expected in the Action Economics Forecast Survey. The ratio of consumer credit outstanding-to-disposable personal income edged higher m/m to 24.4% in February, the highest level since March 2020.
Revolving consumer credit balances rose $18.0 billion (9.7% y/y) in February after growing $3.5 billion in January. Credit provided by depository institutions (90% of the total and mostly credit card debt) rose an increased 11.3% y/y. Credit union borrowing (6% of the total) rose 5.4% y/y. Nonfinancial business loans (2% of the total) held steady y/y. The value of finance company loans (1% of loans) declined 16.7% y/y.
Matching the record set last May, nonrevolving credit usage grew $23.8 billion (5.6% y/y) in February following a $5.4 billion January increase. Federal government borrowing, which issues 42% of nonrevolving credit, grew a lessened 3.3% y/y. Depository institution loans (26% of credit) grew an accelerated 9.5% y/y. Finance company borrowing (17% of loans) grew a fairly steady 5.6% y/y. Credit union loans (14% of the total) rose 6.5% y/y, the quickest since 2019.
During the fourth quarter of 2021, student loan balances rose a lessened 2.6% y/y. Growth in motor vehicle loans rose an accelerated 7.4% y/y, the fastest growth since Q3 2015.
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.
The minutes to the latest FOMC meeting can be found here.
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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