WASHINGTON—Total consumer credit returned “to form in the third quarter," said NAFCU Chief Economist and Vice President of Research Curt Long as it rose 6.2% in August.
June's increase of 1.7% "was the slowest of any month since 2011," Long noted.
Total consumer credit increased 5.1% in July (all seasonally adjusted annual rates). Long attributed the growth in July and August to accelerating revolving (primarily credit cards) and non-revolving credit (primarily auto and education loans) growth. The two segments increased 5.6% and 6.4%, respectively, in August.
"Overall, the outlook for consumer credit remains stable in light of a strong labor market and elevated consumer confidence," Long said in a NAFCU Macro Data Flash report. "However, rising interest rates limit the likelihood that growth will improve meaningfully in the near future."
As CUToday.info reported here, total consumer credit for credit unions increased in August, up 1.4%, compared to a 0.8% increase for banks and a 0.1% decline for financial companies. In the second quarter, total consumer credit at credit unions rose 3.8%, while banks saw a 1.7% increase and financial companies had 0.1% growth.
Credit unions' share of the total consumer credit market remained at 11.5% in August, while banks had 41.3% and financial companies held 13.5% of the market, Long said.