Now that the U.S. real estate bubble has burst and lenders are restricting access to home equity credit lines, consumers are pulling out their credit cards more frequently to cover their expenses, according to a report from Standard & Poor’s.
“We expect credit card receivables to grow in the high single digits for the year 2008,” S&P said in the report, “As Credit Card Use Increases, Issuers Take Actions To Manage Risk.”
Credit card debt in the U.S. is growing faster today than in recent years, following historically low annual growth rates of about 3.3 percent, between 2002 and 2006, according to the report. In May, the Federal Reserve reported that credit card debt grew at an annual rate of 7.1 percent (“Credit Card Debt Surges in May After Falling in April,” July 9). The Fed’s numbers for June are expected to be released Thursday afternoon.
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