Credit Card Debt Falls for 20th Consecutive Month, Down 10.5% in May

Total consumer credit in the U.S. dropped again in May, led by another contraction in total credit card debt outstanding. Credit card debt has fallen 20 consecutive months.

The Federal Reserve reported in their monthly Consumer Credit statistical release, also called G.19, that revolving debt – principally comprised of credit card accounts – fell by $7.4 billion in May, or at an annual rate of 10.5 percent. Total consumer credit card debt outstanding was $830.8 billion, down from a peak of $975.7 billion in September 2008.

Non-revolving debt – comprised of auto, student, personal and other loans – fell $1.8 billion, or at an annual rate of 1.4 percent.

Total consumer credit outstanding at the end of May was $2.415 trillion. The monthly report from the Fed does not include loans backed by real estate.

The decline in total consumer credit in May was greater than analysts’ expectations. Economists’ projections in a Bloomberg survey ranged from a decrease of $5.2 billion to an increase of $2 billion.

Consumer credit numbers are often an indicator of consumer spending in the economy, and an important data point in calculating the staying power of the economic recovery.

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