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Key Takeaways
- Outstanding consumer credit grew by $11.3 billion in May, the biggest increase since February, and more than the $8 billion that economists expected.
- Revolving debt, mainly consisting of credit card charges, grew at a 6.3% annual rate in May.
- The increases come after consumers added less debt in March and April.
After slowing their borrowing habits in March and April, consumers ramped it back up again in May, data from the Federal Reserve showed.
Total outstanding credit increased by $11.3 billion in May, at an annual rate of 2.7%, the biggest increase since February. Economists surveyed by the Wall Street Journal and Dow Jones Newswires forecast an increase of $8 billion. Revolving debt, consisting mainly of credit card charges, increased by $7 billion, a 6.3% annual increase.
The increase comes after consumers have been slower to add debt in recent months, including lowering total outstanding debt in March and pushing total credit card debt lower in April.
Federal Reserve officials have been closely watching consumer spending trends, which helped boost the economy during the pandemic recovery but have also made it harder to bring down persistent inflation.
Retail sales figures in May grew more slowly than economists expected. Economists see consumer spending continuing to slow into the second half of 2024 , though only slightly.