US consumer credit decreases more than expected in April

• Source: Xinhua
• [14:00 June 06 2009]
• Comments

US consumer credit plunged at an annual rate of 15.7 billion US dollars, or 7.4 percent in April, much more than experts expected, the Federal Reserve reported Friday.

The decrease was the second largest decline in outstanding debt on record, exceeded by March's 16.6 billion dollar drop.

 According to the report, total consumer borrowing, which the Federal Reserve defines as all loans not secured by real estate, decreased to an annual rate of 2.224 trillion dollars at the end of April, the lowest level since December 2007.

For April, consumer credit in revolving loans, a category that includes primarily credit card debt, plunged by 11 percent at an annual rate.

 Demand for nonrevolving credit used to finance cars, vacations, education and other things, meanwhile, was down 5.3 percent.

Many analysts believe that the strength in consumer borrowing will continue to be weak as the recession is deepening and job layoffs are rising.