Image: Marriner S. Eccles Federal Reserve Board Building. Source: BackyardProduction / iStockphoto
US consumer borrowing continued to grow throughout the month of April, but credit card usage declined, according to newly-released data from the Federal Reserve Board.
In its G.19 consumer credit report for April, the Fed said total consumer debt outstanding — which includes student loans and auto loans, as well as revolving debt — grew $18.6 billion.
Total borrowing in April stood at $4.24 trillion, 0.4% above the pre-pandemic peak of $4.22 trillion in February 2020. April, the report noted, was the third straight month of strong increases in consumer borrowing trends.
Consumer revolving debt, which is mostly based on credit card balances, dipped $1.9 billion in April to $963.6 billion.
Overall, credit card borrowing is down 12.2% since February 2020, just before the onset of the COVID-19 pandemic. Over the past year, credit card use has only posted increases in three months, as households cut back on spending and focus more on saving, The Associated Press noted.
The Fed’s monthly report does not include home mortgages, home equity loans or any other real estate-related loans.
Despite a rebound in spending due to stimulus payments and businesses reopening, many consumers are hesitant to use credit cards right now, according to The Associated Press.
Nancy Vanden Houten, senior economist at Oxford Economics, told the outlet, “We expect growth in consumer credit will accelerate in the second half of 2021 as consumers dust off their credit cards, and reopenings and better health conditions incentivize stronger outlays.”
Source: Equities News