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Fed Says Consumer Borrowing Sees Slowest Gain in 5 Months
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June 8, 2005 LOS ANGELES --
In April, folks across the
country increased borrowing for consumer debt purposes. In a quasi-oxymoronic
way, you could say that by increasing borrowing for debt, consumers both
followed and broke a trend at the same time. This type of consumer borrowing,
for auto loans, etc., saw a 0.7 percent jump in April. And although consumer's
increased borrowing, they also realized the smallest growth in this sector in
the past 5 months, according to Fed releases Tuesday.
The Federal Reserve announced that April brought-on a $1.26
billion rise in consumer credit, this number falling significantly shy of the
$7.5 billion increase that a slew of analysts expected.
Consumer debt currently lives at a record level of $2.13
trillion. Slap another $8 trillion onto that, which is the rough amount
Americans owe in home mortgage obligations, and the bottom line appears far from
the bottom, doesn't it?
Consumer revolving debt (credit cards, etc.) dropped for a
second consecutive month, the Fed said, leaving us at a 0.6 percent rate in
April. Noteworthy is the fact that it marked the first back-to-back declination
since June and July 2003 ran a 2-month run, consecutively.
Consumer overall demand for non-revolving debt (car loans,
recreational vehicles, etc.) climbed at an annual rate of 1.5 percent. -
Article by Ben Pengreen for CMR
Home Finance.
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