While it is traditionally viewed as a B-grade economic indicator, the August consumer credit report from the Federal Reserve was another shocker especially after last month’s unexpected slow down in credit card debt, which we attributed to the surge in credit card rates and wondered if this implicit deleveraging would continue as the US economy slid into recession, or if US consumers are so desperate for liquidity they will max out their cards – without expecting to repay them – if it meant being able to pay for one more month of goods and services at record prices. We just got the answer when moments ago the Fed published the latest consumer credit data and it was a doozy.
Total consumer credit rose $32.2 billion, well above last month’s $26 billion and also above the $25 billion consensus estimate.
