Revolving credit balances in the U.S. fell for the first time in three months in April, continuing to hover well below pre-pandemic levels.
Made up of mostly credit card balances, revolving credit balances fell at an annual rate of 2.4%, the 11th decrease in the 14 months since the pandemic began, according to the Federal Reserve’s latest consumer credit report, released Monday. April’s drop of $1.96 billion partially erases increases in February and March, bringing balances to $963.6 billion, well below the pre-pandemic peak of $1.1 trillion.
Revolving credit was on a downward trend throughout the pandemic as consumers focused on shoring up their finances and had fewer opportunities to spend. It is now $134 billion lower than the record high reached in February 2020, but this gap may close in the coming months as consumers venture out and spend money on vacations and other things that didn’t make sense to buy during the worst of the COVID-19 outbreak, according to Matt Colyar, an associate economist at Moody’s Analytics.
Non-revolving credit balances—which includes car, personal, and student loans—increased in April, climbing at an annual rate of 7.6% to $3.27 trillion.