Credit Card Balances Fall in June; Monthly Pattern Becomes Unstable
The Federal Reserve reported late Tuesday that outstanding balances for consumer credit card accounts fell in June at its member institutions at an annualized rate of 5.1 percent. The decline followed very strong growth in May.
Consumer credit card debt, or revolving debt, outstanding contracted by a total of $3.4 billion in June. It was the second-largest contraction in a year and signaled a period of month-to-month swings in declines and gains in the credit card market.
Non-revolving debt increased at a 7.2 percent annualized rate in June, driven primarily by gains in auto and student lending.
The numbers coming from the Fed in its month consumer credit data release – also called the G.19 – had begun to show a growth trend in consumer credit card balances over the past year. But with June’s release, credit cards have entered a monthly pattern of ups and downs. Over the past six months, half have seen increases in card balances and half have seen declines.
Still, credit card balances are $13.5 billion higher now than when card debt bottomed out in mid-2011 after a prolonged period of sharp contraction. At the end of June, total consumer credit card debt outstanding was $864.6 billion, down from a peak of more than $1 trillion in 2008.
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Continuing the Discussion