Credit Card Use in US Records Sharp Decline

Americans’ use of credit cards in the 12 months through August saw its steepest contraction since the COVID-19 pandemic recession, suggesting that the U.S. consumer sector may be shifting from credit-driven resilience toward a more cautious footing.

According to the Federal Reserve’s G.19 Consumer Credit report for August, total consumer credit grew at a negligible 0.1 percent annual rate, a sharp deceleration from 4.3 percent in July. Revolving credit—primarily credit cards—fell at a 5.5 percent annualized rate, while nonrevolving credit, such as auto and student loans, rose by 2 percent, partly offsetting the decline.