US Dollar Falls As Credit-Card Debt Jumps In May By Most Since 2007
By DailyFX - 07/09/12 - 3:30 PM EDTBy Tzu-Wen Chen, THE TAKEAWAY: [U.S. consumer credit jumps to highest this year, led by largest revolving credit gain in five years] > [Americans struggle to pay off debts on weak job market and wage growth] > [ USD weakens ] Consumer borrowing in the U.S. jumped more than forecast in May, as credit-card debt recorded its largest gain since November 2007. The Federal Reserve reported today that total credit rose by $17.10 billion in May, the largest rise in five months and the ninth consecutive month of rising debt, while borrowing in April was upwardly revised to $9.95 billion from $6.52 billion originally estimated. The consensus forecast according 32 economists surveyed by Bloomberg News had called for a rise in debt by $8.50 billion. Revolving debt, which includes credit card spending, rose by $8 billion in May, signaling that American consumers are struggling to pay off debts as weaker hiring and wage growth dampens consumer spending growth and confidence . Meanwhile, non-revolving credit, which includes student loans and loans for motor vehicles and mobile homes, climbed by $9.1 billion as students scrambled to beat an impending surge in borrowing costs. AUDUSD 1-minute Chart: July 9, 2012 Chart created using Market Scope – Prepared by Tzu-Wen Chen The US dollar trimmed earlier gains against risk-correlated assets such as the Australian and New Zealand dollars in the minutes following data release, slipping as much as 11 pips against the Australian dollar. At the time of this report, the AUDUSD pair was trading at $1.0203. --- Written by Tzu-Wen Chen, DailyFX Research
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