Total Consumer Credit Ends 2020 Flat

According to the latest (2-5-21) Federal Reserve’s G.19 Report, the economic recession caused by the COVID-19 pandemic derailed the consumer credit’s trajectory growth rate for all of 2020. Revolving credit, of which credit card debt is a major component, shrank by -11.2% over the year, while nonrevolving credit increased 3.9%, thus producing an overall growth rate of 0.0%. According to the G.19, in December, consumer credit increased at a seasonally adjusted annual rate of 2.8% from the previous month, with revolving debt decreasing by -3.6% and nonrevolving debt increasing by 4.8%. Consumer credit totaled $4.2 trillion on a seasonally adjusted annual basis, with $976 billion comprised of revolving debt and $3.2 trillion in nonrevolving debt. This is an increase of $9.7 billion from the previous month, with revolving credit decreasing by -$3 billion and non-revolving credit increasing by $13 billion. The reduction is revolving credit in 2020 could be attributed to consumers slowing their short-term to repayment purchases.