It has been said that after excess savings came down, credit is the one sustaining spending at the moment.
“US consumer borrowing slowed to a more than two-year low in May, reflecting the first decline in non-revolving credit since the onset of the pandemic.”
- Total credit rose $7.2 billion, the smallest advance since November 2020. The figure, which isn’t adjusted for inflation, was lower than all forecasts in a Bloomberg survey of economists.
- Non-revolving credit, such as loans for school tuition and vehicle purchases, decreased $1.3 billion, the first decline since April 2020. Five-year lending rates for new-vehicle purchases reached 7.81% in May, the highest since 2006
- Revolving credit outstanding, which includes credit cards, rose $8.5 billion — representing a slowdown after sharp gains in the previous two months. Credit cards issued by commercial banks carried a 20.68% rate in May, a record in Fed data back to 1972.
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Non revolving usually does not go negative.
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