Consumer Credit Growth Jumps as Savings Rate Dwindles
In April, consumer credit growth increased at its fastest pace in nearly three years, bolstering the consensus view of a rebounding consumer. However, year-over-year growth in revolving credit – largely credit card spending – remains far below its historical average of 11% in the quarter century preceding the Great Recession. Furthermore, with the personal savings rate near its lowest rate since 2008, consumers have little choice but to rely on credit.
ECRI’s latest analysis provides a clearer picture of consumer spending, examining whether its apparent strength stands up to scrutiny.