Revolving Debt Surges as Credit Card Rates Hit 18-Year High

2022-11-08T16:19:45-06:00

By David Logan on November 8, 2022 • According to the Federal Reserve’s latest G.19 Consumer Credit report, consumer credit growth (ex-real estate) decelerated to a seasonal adjusted annual rate (SAAR) of 6.8% in the third quarter of 2022 after growing at an 8.7% pace in the prior quarter.  Revolving debt increased at a 12.9% rate, more than double the pace of nonrevolving debt (+4.9%). Credit card interest rates reached 16.3%, the highest level since the inception of the data series in 1994. Total consumer credit currently stands at $4.7 trillion, an increase of $100 billion over the second quarter. Revolving and nonrevolving debt accounted for 24.7% and 75.3%, respectively, of non-revolving debt. Nonevolving credit outstanding increased $42.6 billion while the level of revolving debt rose $36.3 billion over the quarter. Between Q2 2020 and Q2 2021, revolving consumer credit outstanding as a share of the total steeply declined as stimulus checks were used to pay down credit card debt. The share has increased each quarter since. With every quarterly G.19 report, the Federal Reserve releases a memo item covering student and motor vehicle loans’ outstanding levels on a non-seasonally adjusted (NSA) basis. The most recent release shows that the balance of student loans was $1.8 trillion at the end of the third quarter while the amount of auto loan debt outstanding stood at $1.4 trillion. Together, these loans made up 88.9% of nonrevolving credit balances (NSA), down 0.1 percentage point from Q2 2022. Related ‹ Concentration of Large Builders in Metropolitan Markets- Update (2021)Tags: auto loans, consumer credit, consumer debt, credit, credit cards, Federal Reserve, interest rates, non-revolving debt, nonrevolving debt, revolving debt

Revolving Debt Surges as Credit Card Rates Hit 18-Year High2022-11-08T16:19:45-06:00

Revolving Consumer Credit Posts Double-Digit Increase in Q2 2022

2022-09-01T17:21:55-05:00

By David Logan on August 31, 2022 • Non-real estate consumer credit grew at a seasonal adjusted annual rate (SAAR) of 8.7% in the second quarter of 2022 according to the Federal Reserve’s latest G.19 Consumer Credit report. Revolving debt climbed 14.6% (SAAR), double the increase in nonrevolving debt (+6.9%). Total consumer credit currently stands at $4.6 trillion, with $1.1 trillion in revolving debt and $3.5 trillion in non-revolving debt. From the previous quarter, total consumer credit increased by $98.9 billion, with revolving debt and non-revolving debt increasing by $40.3 billion and $59.3 billion, respectively. Part of the recent growth in consumer credit—both revolving as well as nonrevolving—is explained by persistently high inflation. The increase in nonrevolving credit owes mostly to higher car prices. Since January 2021, new and used car prices have increased nearly 15% (year-over-year) each month, on average, while sales volume declined. Revolving credit balances can be similarly explained by rising price levels as the 12-month increases for energy and food items averaged 32% and 9% over the first two quarters of 2022. With every quarterly G.19 report, the Federal Reserve releases a memo item covering student and motor vehicle loans’ outstanding levels on a non-seasonally adjusted basis. The most recent memo item indicates that, as of the second quarter of 2022, student loans stood at $1.8 trillion and motor vehicle loans stood at $1.4 trillion. Annualized, the changes in these two categories from the previous quarter are $3.2 billion and $129.1 billion, respectively. Together, these loans made up 88.9% of nonrevolving credit balances (NSA) in the second quarter. Although this share is near the ten-year average (91.4%), it is the smallest since 2011. Related ‹ Home Price Growth Eased in JunePrivate Residential Spending Slides in July ›Tags: auto loans, consumer credit, consumer debt, energy, energy prices, household debt, inflation, non-revolving debt, revolving debt, student loan debt

Revolving Consumer Credit Posts Double-Digit Increase in Q2 20222022-09-01T17:21:55-05:00

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