Aug 11, 2013 Walt Wojciechowski
The slower than expected increase can be partly attributed to a decrease in credit card use. In total, consumer installment credit rose by $13.8 billion in June to total $2.85 trillion, Reuters reported. Following a survey of economists conducted by Reuters, credit was forecast to jump by $15 billion.
"I think this report speaks to a well-functioning credit marketplace," Ezra Becker, vice president of research and consulting at TransUnion, told Reuters. "Lenders are offering more credit, and consumers are using it without an over-reliance on credit."
Loans for cars and college tuition, also known as non-revolving credit, continued to reflect high demand. However, the news source noted that analysts are concerned that rapidly rising interest rates could damage the economy's steady recovery.
A separate forecast from Bloomberg surveyed 32 economists who predicted increases in consumer credit anywhere between $10 billion to $21 billion. The news source attributed the slow down in consumer credit growth to a higher payroll tax, which reduces how much money Americans take home at the end of the day.