The pace of U.S. consumer borrowing has been on a roller coaster in recent years. It was remarkably stable in the years leading up to the pandemic with growth near 3% or 4%, depending to some extent on whether it was measured using credit bureau data or Federal Reserve data. Growth in borrowing briefly weakened when the pandemic was at its worst but swiftly and powerfully rebounded to a pace not seen since the years leading up to the financial crisis. Growth peaked around the start of 2022 and has since fallen rapidly. There are many factors driving this pattern of borrowing, including the path of interest rates; growth in spending; inflation both broadly and for specific items frequently bought on credit, such as homes and vehicles; income growth; and the labor market.
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- United States of America