Consumer Credit Grew By Bigger-Than-Expected $7.3B in May By Deborah Lagomarsino
WASHINGTON -- U.S. consumers increased their outstanding borrowing in May, charging more on credit cards and taking on more non-revolving debt like car and boat loans, said the Federal Reserve (news - web sites).
Consumer credit outstanding rose $7.3 billion in May to $1.76 trillion. That follows a revised $7.9 billion gain in April, originally reported up $10.7 billion. May's increase was larger than the $5 billion gain Wall Street had expected.
Consumer credit data tends to be highly volatile from month to month and is frequently revised.
May's boost was led by non-revolving credit, but revolving credit also increased.
Non-revolving credit rose $4.2 billion in May after rising a revised $6.6 billion in April. Non-revolving credit includes all loans not part of revolving credit -- such as those for automobiles, motor homes, education, boats, trailers or vacations.
Revolving credit, such as credit cards, increased $3.1 billion in May after a revised $1.2 billion boost in April.
In annual terms, consumer credit grew at a 5% rate in May, down from a revised 5.4% rate in April. Revolving credit increased at a 5.3% annual rate in May, up sharply from April's 2% rate. Non-revolving credit rose at a 4.9% annual rate in May, down from a 7.8% rate in April.
For the first quarter, consumer credit rose at a 4.3% annual pace after contracting at a 0.2% pace in the fourth quarter. In the first quarter, revolving credit grew at a 4.9% pace and nonrevolving credit increased at a 3.8% rate.