Consumer Borrowing Turns Around in July
9/11/2017 2:13 PM
New car purchases and student loans caused a surge in mid-summer consumer borrowing while credit card use declined.
Total consumer borrowing in July increased at the fastest rate in five months, fueled by more auto purchases and student loans, MarketWatch reports.
The Federal Reserve released its Consumer Credit report for July last week showing total consumer borrowing increased $18.5 billion, or at an adjusted annual rate of 6 percent. In June, total consumer borrowing increased by $11.9 billion.
The rate increase is also “well above the annualized 3.8 percent increase in June,” MarketWatch reports.
Nonrevolving debt, including student loans and auto loans, increased $15.8 billion in July and at an annual rate of 7 percent, according to the Fed’s report. Revolving debt, including credit card purchases, increased by $2.6 billion in July after a revised increase of $4.7 billion in June, according to the report.
Overall, MarketWatch reports, “Credit typically expands at a faster pace when the economy is strong and Americans are confident. Credit rose at a rapid clip early in the year, slowed a bit in the second quarter, but now appears to have picked up again.”
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