Credit Card Debt Declines in June
Overall consumer credit increased at an annual rate of nearly 6% in June, but none of this was due to consumers charging more on their credit cards. In fact, consumers seem to be paying more of the balance on their credit cards, according to the Federal Reserve’s latest monthly report on consumer credit.
Revolving credit, the majority of which is credit card debt, decreased at an annual rate of 3.8% in June. The $2.7 billion decline in revolving credit was the biggest drop of the year. The biggest gain of the year, a $6.6 billion increase, took place in May.
Significant increases in non-revolving debt occurred for the second straight month. Non-revolving debt is made up mostly of auto and student loans. This debt increased $11.1 billion in May and $16.5 billion in June. These equated to annualized increases of 6.8% and 10.0% respectively.