The numbers: Total consumer credit rose $9.1 billion in September, up from a $15.8 billion drop in the prior month, the Federal Reserve said Tuesday. That translates into a gain at a 2.2% annual rate, up from a 3.8% drop in the prior month.
Economists had been expecting a $9.5 billion increase, according to the Wall Street Journal forecast.
Key data: Revolving credit, like credit cards, slowed to a 2.9% increase after a 13.7% gain in the prior month.
Nonrevolving credit, typically auto and student loans, rose 1.9% after an unusual 9.8% drop in the prior month. This category of credit is typically much less volatile. The decline in August was due to the small portion White House plan to forgive student loans not blocked by the Supreme Court’s ruling, economists said.
The Fed’s data does not include mortgage loans, which is the largest category of household debt.
Big picture: Economists note that it is getting more expensive to borrow money as the Fed has raised interest rates and bank have tightened standards. As a result, consumers are expected to be more reluctant to use credit cards.
A separate survey from the New York Fed found that credit-card delinquencies are on the rise, with the sharpest increase among borrowers aged 30 to 39.
Market reaction: Stocks
were higher in late day trading Tuesday while the 10-year Treasury note
fell seven basis points to 4.57%.