| Consumer Credit |
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Released On 5/6/2011 3:00:00 PM For Mar, 2011
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Prior | Consensus | Consensus Range | Actual |
| Consumer Credit - M/M change | $7.6 B | $5.0 B | $2.0 B to $7.0 B | $6.0 B |
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Highlights
Consumers used their credit cards in March as revolving credit outstanding rose $1.9 billion to $796.1 billion. It isn't much but will hopefully be followed by subsequent gains to mark an upturn after three years of contraction. Consumers have been using nonrevolving credit much more given the long run of strong vehicle sales. Nonrevolving credit rose $4.1 billion vs $10.2 billion in February. Total consumer credit outstanding, revolving and nonrevolving together, rose $6.0 billion in March.
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Market Consensus before announcement
Consumer credit outstanding $7.6 billion in February, following a $4.4 billion gain the month before. This measure of short-term debt, however, was boosted entirely by a surge in non-revolving credit which jumped $10.3 billion, reflecting a jump in motor vehicle purchases. Partially offsetting was a $2.7 billion decline in revolving debt, following a $3.9 billion drop in January. Given that unit new motor vehicle sales dipped in March, we are likely to see weakness in consumer credit for the same month.
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Definition
The dollar value of consumer installment credit outstanding. Changes in consumer credit indicate the state of consumer finances and portend future spending patterns.
Why Investors Care
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![[Chart]](showimage.asp?imageid=20780)
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The debt-to-income ratio shows how indebted consumers are relative to income. A rising ratio indicates that consumers are taking on greater debt burdens with respect to income growth. In a growing economy, this may not be dangerous. However, indebtedness could quickly become a problem if income and employment conditions turn around. The yearly change in debt outstanding shows yearly trends in debt growth and tends to be less volatile than the monthly change.
Data Source: Haver Analytics
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