Credit Card Debt Surpasses $1 Trillion
4/10/2017 6:22:00 PM
The latest Federal Reserve Board consumer credit report shows credit card, student loan and auto loan borrowing all increased in February.
Consumers’ outstanding credit card debt surpassed $1 trillion in February, according to the Federal Reserve’s monthly Consumer Credit report released Friday.
Total outstanding debt increased $15.2 billion, to approximately $3.8 trillion, in February, according to the Fed’s report. Revolving debt, including credit card balances, increased $3 billion and nonrevolving debt, including student loans and auto loans, increased by $12.3 billion to approximately $2.8 trillion.
February’s increase in total borrowing follows a revised increase of $10.8 billion in January. Borrowing for credit cards declined by $2.7 billion in January, according to the report.
“With the February data, credit cards are now the third consumer-lending category to enter into trillion-dollar territory in recent years, following auto loans, which hit the milestone in the past two years, and student loans, which pushed over $1 trillion before that,” The Wall Street Journal reports. “The big question among economists is how long this bullish streak in consumer debt can keep going. While there is little sign that unemployment will rise soon, economists are looking closely at the impact of rising rates on consumers’ ability to afford the debt they racked up during years of rock-bottom rates.”
Credit card debt is also at its highest level since January 2009 and 6.2 percent more than a year ago, according to The Wall Street Journal.
According to the Fed’s report, revolving credit increased at an annual rate of 3.5 percent, while nonrevolving credit increased at an annual rate of 5.25 percent. Total consumer credit increased at an annual rate of 4.75 percent, according to the Fed.
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