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Economy in Brief

U.S. Consumer Borrowing Strengthens
by Tom Moeller  May 7, 2015

Consumer credit outstanding increased $20.5 billion (6.9% y/y) during March following a $14.8 billion February rise, initially reported as $15.5 billion. The gain was the strongest since July. Expectations were for a $16.0 billion increase, according to the Action Economics Forecast Survey. During the last ten years, there has been a 49% correlation between the y/y growth in consumer credit and the y/y growth in personal consumption expenditures.

Non-revolving credit usage ramped up $16.2 billion (8.2% y/y) after a $17.2 billion rise. Federal government loans increased 14.3% y/y. These constitute just over one-third of total non-revolving credit. Finance company lending (25% of the total) improved 2.1% y/y. Bank borrowing (25% of the total) rose 5.6% y/y and borrowing at credit unions (11% of the total) advanced 15.8% y/y. Nonprofit & educational institution loans (2% of the total) declined 10.7% y/y. Nonfinancial business loans (1% of the total) remained unchanged y/y.

Revolving consumer credit increased $4.4 billion (3.3% y/y) following declines during the prior two months. Commercial bank & savings institution lending (82% of the total) increased 4.8% y/y. Finance company balances (7% of the total) declined 9.2% y/y while borrowing from credit unions (5% of the total) gained 7.5% y/y. Nonfinancial business balances (3% of the total) were off 5.5% y/y and securitized credit card balances (4% of the total) gained 0.9% y/y.

Student loans increased 7.4% y/y to $1.355 trillion during the first quarter while borrowing to buy motor vehicles advanced 9.0% y/y to $972 billion.

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) Mar Feb Jan Y/Y 2014 2013 2012
Total $20.5 bil. $14.8 bil. $9.9 bil. 6.9% 7.1% 6.0% 6.1%
   Revolving 4.4 -2.4 -2.5 3.3 3.7 1.4 0.6
   Nonrevolving 16.2 17.2 12.4 8.2 8.4 7.9 8.5
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