Companies and Brands

Consumer Credit On The Rise

Consumer credit is still on the rise. Is it due to the public borrowing for summer vacations, or is it something else?  The latest report from the Federal Reserve shows that credit rose during the month of May.  It is not just rise, it rose by 8% annualized and that was the highest gain in 2012. The gain was by $17.12 billion to over $2.57 trillion.  Dow Jones was calling for only $7.8 billion and Bloomberg had a consensus of a build of $8.5 billion.

Today’s report almost feels like Christmas in May because the 8.04% rise was the highest since December’s rise of 8.27%. You would expect to see credit get used in December because of the Christmas holidays.  Is the buildup in May tied to the pre-vacation season?  Or are the retail sales holding up better than some of the numbers might be suggesting?

There is also more good news if you like to see credit expansion. The figure from April’s gain was revised up to $9.95 billion from $6.51 billion originally telegraphed.

Non-revolving credit rose by $9.1 billion to $1.703 trillion and those loans include items such as car loans and student loans.  Now you know why we projected that the student loan market will hit $1 trillion by the end of 2012 as the report showed that this student segment was up $6.2 billion to $464.9 billion.

The debt on credit cards and other revolving credit rose by just over $8 billion to $870.19 billion in May.

JON C. OGG

Get Ready To Retire (Sponsored)

Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.

Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.

Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future

Get started right here.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.