Consumer Credit Surges

The consumer may be showing limited enthusiasm for spending but certainly was borrowing in March. Consumer credit rose $29.7 billion in a surge that makes up for several months of prior weakness and includes a very strong $11.1 billion gain for revolving credit, indicating less reluctance to run up credit cards. Non-revolving credit rose $18.6 billion and once again reflects student loans and vehicle financing. The monthly headline is the strongest since a break in this series 5 years ago while the gain for the revolving component is the strongest since a prior break 10 years ago. The willingness to borrow hints at improved consumer confidence in the general outlook and reflects the strength of the labor market.

Recent History Of This Indicator:
Consumer credit is expected to rise $15.8 billion in March following a $17.2 billion gain in February. Nonrevolving credit, boosted by vehicle sales and also by student loans, is by far the stronger of this report's two components with non-revolving credit, offering its own signals on credit cards and consumer spending, showing mostly weakness.