U.S. consumer credit soars in July with biggest gain since '01: Reuters
09.09.2014,
14:07
U.S. consumer credit soared in July, posting its biggest jump since November 2001, driven in part by demand for auto loans and student borrowings.
YEREVAN, September 9. /ARKA/. U.S. consumer credit soared in July, posting its biggest jump since November 2001, driven in part by demand for auto loans and student borrowings.
Total consumer credit increased $26.01 billion to $3.24 trillion in July, the Federal Reserve said on Monday. June's consumer credit figure was revised up to show an $18.81 billion increase from $17.26 billion.
Economists polled by Reuters had expected consumer credit to increase $17.35 billion in July.
Chris Low, chief economist at FTN Financial, said the credit growth is being driven by auto loans, though he added that signs of loose standards and spikes in default rates are showing.
"The only thing we have to worry about is there is excessive risk-taking in the auto sector," said Low.
"But it's still a good thing for the economy at least in the short term. Car sales are back to where they were before the financial crisis, which is remarkable."
Revolving credit, which mostly measures credit-card use, increased $5.34 billion to $880.5 billion, after an upwardly revised $1.81 billion increase in June.
Non-revolving credit, which includes auto loans as well as student loans made by the government, increased $20.65 billion in July to $2.36 trillion after an upwardly revised $16.99 billion increase in June.
"People are feeling more comfortable in their jobs, and more comfortable with the economy," said Matt Schulz, senior industry analyst at CreditCards.com, who pointed to auto loans and student lending as driving the growth. –0--
