1. Consumer Credit March 2015
Conclusion
Consumernon-residential creditgrew$20.5bnlinkedmonth (7.4% annualized) and6.9% on an actual
yearover yearbasis. Of the $20.5bn linkedmonthincrease,$4.3 wasrevolvingcredit(creditcards)
meaning80% consumernon-residential creditgrowthcame fromnon-revolving(studentandautodebt)
credit. Aswe see below,consumerrevolvingcreditbalanceshave beenstagnantfor9 consecutive
months,consistentwithslowingconsumeractivityoverall:
On a yearover yearbasis:
RevolvingCredit: 3.3%
Non-RevolvingCredit: 8.2%
Total ConsumerCredit: 6.9%
On a 3 monthannualizedbasis,bysub-component:
RevolvingCredit: -0.3%
Non-RevolvingCredit: 7.5%
Analysis
From a level perspective,we cansee justhow fast non-revolvingcredit(redline) is growing, particularly
whencontrastedwiththe slow growingrevolvingbalances (blue line). Moreover,we canalsosee that
the non-revolvingbalances(redline) have now brokenthroughthe upside of the post-1992trendline
indicatingpotentially,the presence of a“bubble”innon-revolving(studentandauto) debt :
6/30/2014 $875.8
7/31/2014 880.4
8/31/2014 881.4
9/30/2014 883.4
10/31/2014 884.6
11/30/2014 885.9
12/31/2014 890.0
1/31/2015 887.5
2/28/2015 885.1
3/31/2015 889.4
Consumer Revolving Credit Balances, ($BN)
2. From a yearoveryear perspective, we see thatrevolvingbalancesare growingat a pace that is
consistentwith bothwages(greenline) andconsumptionexpenditures(purple line). We alsosee that
non-revolvingbalances(redline) are growingfarinexcessof bothwages(greenline)andconsumption
expenditures(purpleline):
0
500
1000
1500
2000
2500
3000
Consumer Non-Residential Credit, By Type
Revolving Consumer Credit Non-Revolving Consumer Credit
3. Belowwe see thatrevolvingcreditgrowthona3 monthannualizedbasisisslowing,consistentwith
mostof the recentconsumerrelateddata:
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
Revolving and Non-Revolving Consumer Credit Growth,
Y/Y
Revolving Consumer Credit, Y/Y Non-Revolving Consumer Credit, Y/Y
Wages, Y/Y Personal Consumption Expenditures, Y/Y