Consumer credit was the major newsmaker last week, with April consumer borrowing increasing at an annual rate of 3 percent to hit $2.55 trillion for the month, the Federal Reserve reported. Revolving credit, such as credit cards, decreased at an annual rate of 4.8 percent, ticking down to $862.3 billion. Non-revolving credit, such as car loans and student loans, increased at an annual rate of 7.1 percent to $1.68 trillion.

Much of the gains in non-revolving debt were due to student loans, according to Dana Saporta, director of U.S. economics research at Credit Suisse.

Unit labor costs in non-farm businesses increased 1.3 percent in the first quarter of 2012, while hourly compensation increased 0.4 percent. Unit labor costs rose 0.9 percent over the last four quarters.

In the week ending June 2, initial claims for jobless benefits dropped to 377,000, a decrease of 12,000 from the previous week’s revised figure of 389,000. The four-week moving average was 377,750, an increase of 1,750 from the previous week’s revised average of 376,000.

The total number of insured unemployed workers during the week ending May 26 hit 3,293,000, an increase of 34,000 from the preceding week’s revised level of 3,259,000. The four-week moving average was 3,279,500, an increase of 11,500 from the preceding week’s revised average of 3,268,000.

The U.S. economy is still growing but slowly, and there appears to be a little more risk than earlier in the spring. Credit is cheap but consumers will remain cautious due to the excessive publicity of the bad economic data and the exclusion of the good. This is also impacting business hiring decisions. Hopefully growth will accelerate to a more respectable rate by the end of the year, maybe by the end of fall. No doubt this will be wholly due to the re-election of President Obama or the election of Presidential Candidate Romney. Well, at least that’s what MSNBC and Fox News will be telling us.

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