Bloomberg
The numbers: The Federal Reserve said consumer credit in April slowed to a seasonally adjusted annual rate of 2.9%, or $9.3 billion, down from 3.8% in March.
Economists polled by Econoday expected a gain of $14 billion. This was the third straight monthly slowdown in credit growth.
What happened: Nonrevolving credit such as student and auto loans grew 3% in April, down from a 5.7% rate in March. It is the slowest pace since September.
Revolving credit, namely credit cards, rose 2.6% in April after declining in March and barely growing in January and February. This is well below last year’s monthly average gain of 5.9%. Revolving credit is still narrowly holding above the $1 trillion level.
Mortgage lending is excluded from the data.
Big picture: The softening in consumer credit is mainly due to less credit card use. Economists said lending standards are tighter. They note that consumer borrowing was strong in the fourth quarter in the wake of the devastating hurricane season.
Economists generally think the consumer is in good shape. Earlier Thursday, the Fed reported that, thanks to rising house prices, the net worth of households and nonprofits rose to $100.77 trillion from $99.74 trillion in the first quarter.
Market reaction: The S&P 500 was lower Thursday as tech stocks gave back some of their recent rally.