U.S. Consumer Credit Exceeded Estimates in July on Broad Demand
(Bloomberg) -- U.S. consumer debt rose in July more than forecast as non-revolving credit grew by the most since November and credit-card debt outstanding rebounded, Federal Reserve figures showed Monday.
Highlights of Consumer Credit (July)
- Total credit climbed $16.6b (est. up $14b) from a downwardly revised $8.5b gain the prior month (prev. $10.2b)
- Non-revolving debt outstanding rose $15.4b m/m after $9.6b gain
- Revolving credit outstanding rose $1.3b m/m, after falling $1.2b
The surge in non-revolving debt, which includes loans for education and automobiles, in part reflects support in demand for big-ticket items.
The increase in revolving debt, which includes credit cards, is consistent with reports showing consumers were spending more freely at the start of the third quarter. Retail sales posted a solid gain in July as Americans bought clothes, shopped online, and headed to restaurants.
Strong hiring and lower taxes are helping households even though inflation is ticking higher. The Fed’s consumer credit report doesn’t track debt secured by real estate, such as mortgages and home equity lines of credit.
- Lending by the federal government, which is mainly for student loans, rose by $3.6 billion before seasonal adjustment
- Credit increased at a seasonally adjusted annual rate of 5.1 percent, after 2.6 percent in the prior month
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