America: $83.07 billion, the lowest credit and savings hike since 2008

Tuesday’s data showed that US consumer credit increased more-than-expected in April year-on-year by 10.1%, while Americans maintained a strong pace to use credit cards to fund purchases at a time of rising inflation. It increased by $38.07 billion after increasing by $47.34 billion in March, and economists polled by Archyde.com had expected consumer credit to rise by $35 billion in April.
The report indicated that borrowing rose in April after a record jump in the previous month, driven by higher prices and the continued strength of American consumers.
Federal Reserve figures showed that revolving credit, which includes credit cards, increased by $17.8 billion after rising by $25.6 billion in March, and non-revolving credit, which includes auto and school loans, rose by $20.3 billion after big gains in the previous two months, and Americans continued spending so far in the face of Price hikes, including in April, when personal expenditures rose 0.9% from the previous month after adjusting for inflation, and real spending increased 0.7% in April.
With inflation largely outpacing wage growth, consumers relied on both savings and credit cards to pay for daily necessities and discretionary purchases, with the savings rate hitting its lowest level since 2008 at 4.4% with 537 million credit card accounts opened in the first quarter, according to to the Federal Reserve Board of New York.
While this is positive in the sense that consumer spending is by far the largest contributor to the US economy, it could be worrying if Americans fail to keep pace with payments and could ultimately mean a slowdown in inflation-adjusted consumption, according to Bank of America data. That may already be happening, and the group said in a report Monday: Single-family card spending fell to 4.3% from a year earlier in May, down from 6.8% in April and less than the expected 8.2% increase in Friday’s consumer price index. .