WASHINGTON – United States consumer debt rose less than forecast in June as Americans whittled away at their credit-card balances following a big bump in the previous month.
Total credit rose $14.6 billion, the least in three months and undershooting the median estimate of economists after a revised $17.8 billion increase in May, Federal Reserve figures showed Wednesday. The June advance was entirely due to the biggest increase in non-revolving credit this year.
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- The report showed a slowdown in borrowing after a month in which consumers’ credit-card balances climbed by the most since October. Americans may be less willing to take on more debt amid uncertainty in the economy with the ongoing U.S.- China trade war.
- Overall, though, a historically tight labor market and elevated wages are keeping consumers optimistic. Job gains have averaged 165,000 a month this year through July, slower than in 2018 but enough to hold the jobless rate near its lowest in almost 50 years. Average hourly earnings growth remains steady.
- Revolving credit outstanding, which includes credit card debt, decreased $80.5 million after a $7.5 billion advance.
- Non-revolving debt outstanding expanded $14.7 billion after a $10.3 billion gain. Such debt includes loans for school and automobiles.
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- Credit expanded at an annual rate of 4.3 percent in June, after growing 5.3 percent the month prior.
- Economists surveyed by Bloomberg had projected the credit gauge would rise by $16.1 billion.
- Outstanding student loan balances were little changed at $1.61 trillion in the second quarter after $1.6 trillion. Balances for motor vehicle loans increased to $1.17 trillion from $1.16 trillion.
- The consumer credit report doesn’t track debt secured by real estate, such as home equity lines of credit and home mortgages.
Katia Dmitrieva is a reporter for Bloomberg News.