Consumer credit increased at a seasonally adjusted annual rate of 5 percent in the second quarter. Revolving credit decreased at an annual rate of 1/2 percent, while nonrevolving credit increased 7-3/4 percent. In June, consumer credit increased at an annual rate of 3 percent.
June was a pretty weak month for retail sales and likely caused the decline in revolving credit. The consistent gains in nonrevolving credit over the past two years seem to be driven by persistent unemployment. A tough job market has lead many to go back to school and take out student loans.