WASHINGTON (8/8/14)--In line with overall trends, consumer credit at credit unions climbed $5 billion in June from the prior month, with nonrevolving loans driving the majority of the gains and credit card debt only picking up slowly.
Nonrevolving credit, which is tied to more substantial items such as homes or automobiles, jumped $4.5 billion up to $241 billion. Revolving credit, largely associated with credit card usage, edged up by $500 million in June to $43.3 billion total outstanding for credit unions.
"Revolving credit balances are growing at a tepid pace and will continue to do so in the near term," said Andrew Davis, Moody's analyst (Economy.com Aug. 7). "However, continued labor market improvement will help drive growth in the coming quarters. Consumer confidence will grow as the job market strengthens, and appetite for revolving credit will slowly begin to rise."
Consumer credit across all categories of institutions expanded by $17.3 billion in June, just short of expectations, according to Moody's analysts.
Again big-ticket items fueled the increase, as $16.3 billion of that total came in the form of nonrevolving loans.
"The release of pent-up vehicle demand is benefiting nonrevolving balance growth," Davis said. "Vehicle sales have held above 15 million units SAAR since April, and student loan demand continues to swell."