Consumer credit continued to grow in February, expanding by $8.7 billion. February’s gains were again driven by growth in non-revolving credit, offsetting a decline in revolving credit. Although February’s gain was strong, it represents a slowdown from the rapid pace set over the previous three months, where growth averaged 18.3 billion. Consumer credit has now expanded for six consecutive months.
February’s consumer credit growth was again led by a jump in non-revolving credit, which grew by $10.9 billion, down from the $21.6 billion growth seen in January. Non-revolving credit consists of big-ticket items, such as student loans and auto which have both been growing rapidly in recent months.
Revolving credit contracted for the second month, shrinking $2.2 billion. Although consumers have increased spending in recent months, it appears that they have done so by reducing their savings as the personal savings rate fell to 3.7% in February.
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