Alexa

US consumer borrowing increases in April even though borrowing on credit cards slowed sharply

US consumer borrowing increases in April even though borrowing on credit cards slowed sharply

Americans relied a lot less on their credit cards in April with debt in that area rising at the slowest pace in nearly three years.
The Federal Reserve said Friday that consumer borrowing increased at an annual rate of 4.2 percent in April, slower than the 6.2 percent increase of March.
The slowdown reflected the fact that borrowing in the category that includes credit cards rose at an annual rate of just 0.4 percent, the weakest performance since borrowing in this area actually declined at a 1.8 percent rate in May 2005.
The slowdown in growth in credit cards and other revolving debt was offset somewhat by a surge in borrowing for auto loans and other types of non-revolving credit, which jumped at an annual rate of 6.5 percent, up from the March rate of increase of 5.5 percent.
The overall rate of increase in consumer credit of 4.2 percent followed a March jump of 6.2 percent which had been the fastest advance since an 8.2 percent growth rate in borrowing in November.
The $8.95 billion increase, which was a little above expectations, pushed consumer borrowing to an annual level of $2.56 trillion, a new record.
The slowdown in use of credit cards followed a period of heavy use by consumers who had been forced to put more of their borrowing on their credit cards as banks have tightened lending standards for home equity loans in response to the deepening crisis for debt secured by mortgages.
The Fed's measure of consumer credit does not include any borrowing secured by real estate.


Updated : 2020-12-04 13:13 GMT+08:00