Photographer: Simon Dawson/Bloomberg
U.S. Consumer Borrowing Cools on Slump in Revolving CreditBy
U.S. consumer borrowing rose at a slower pace in March as credit-card debt outstanding declined by the most since the end of 2012, Federal Reserve figures showed Monday.
Highlights of Consumer Credit (March)
A 0.9 percent annualized decline in first-quarter credit-card debt outstanding shows a waning appetite for borrowing after a 10.3 percent surge in the final three months of 2017.
At the same time, the pace of non-revolving credit picked up in the first quarter, partly explained by a rebound in motor-vehicle sales. The Fed’s consumer credit report doesn’t track debt secured by real estate, such as home equity lines of credit and home mortgages.
The results are consistent with first-quarter data that showed household spending cooled following a strong run of gains. Consumption is expected to rebound as consumers benefit from lower taxes in addition to the strong job market. At the same time, wage gains remain moderate and gasoline costs are edging up, which may hinder discretionary spending unless they take on more debt.
- Lending by the federal government, which is mainly for student loans, rose by $2.1 billion in March, before seasonal adjustment
- Student loan balances climbed $30.4 billion in first quarter
- Lending for motor vehicle purchases increased $9.1 billion in the January-March period
— With assistance by Jordan Yadoo