U.S. Consumer Credit Usage Moderates in September
by:Tom Moeller
|in:Economy in Brief
Summary
- Nonrevolving credit strength continues to diminish.
- Revolving credit usage rebounds.
Consumer credit outstanding increased $6.0 billion (2.2% y/y) during September after rising $7.6 billion in August, revised from $8.9 billion, and $27.3 billion in July, revised from $26.6 billion. A $14.0 billion increase had been expected in the Action Economics Forecast Survey. The ratio of consumer credit outstanding to disposable personal income was little changed at 23.3% in September, a ratio that has drifted lower the last two years.
Nonrevolving credit outstanding increased $5.0 billion (1.3% y/y) in September after increasing $9.8 billion in August and $17.0 billion in July. Nonrevolving credit held by banks fell 1.4% y/y, down from a +11.0% y/y high in April 2022 while finance company nonrevolving credit rose 3.4% y/y, half the increase early this year. Credit union nonrevolving balances declined 2.1% y/y in September, off from 20.3% y/y growth in January 2023. Federal government balances surged 3.6% y/y to $1.52 trillion in September.
Revolving credit outstanding, which includes credit cards, rose $1.1 billion in September (4.9% y/y) following a $2.1 billion August decline and a $10.4 billion July rise. Revolving credit outstanding held by depository institutions rose 5.0% y/y, down from a high of 15.4% y/y growth in August 2022. Revolving credit held by finance companies fell 10.6% y/y while revolving credit held by credit unions rose a diminished 5.3% y/y in September.
The consumer credit figures from the Federal Reserve Board are break-adjusted and calculated by Haver Analytics. The breaks in the series in 2005, 2010 and 2015 are the result of the incorporation of data from the Census and the Survey of Finance Companies, as well as changes in the seasonal adjustment methodology. The consumer credit data are available in Haver’s USECON database. The Action Economics forecast figures are contained in the AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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