The Federal Reserve reported last week that consumer credit expanded in May by 8 percent over April to a total of $2.57 trillion, marking a $17.12 billion gain, the largest in five months.
Encouraging news in the economic sector was the growth in revolving debt, such as credit cards, which jumped by 11.2 percent to $870.2 billion. This followed a 4.9 percent drop in April and only meager increases earlier this year. Many experts hope that an increase in credit card use will spur consumer spending and help fuel economic recovery.
Non-revolving debt, such as car and school loans, grew 6.5 percent, slightly down from April’s 9.6 percent pace, to $1.7 trillion.
The Employment and Training Administration reported last week that initial claims for unemployment insurance filed in the week ending July 7 dropped to 350,000, a decrease of 26,000 from the previous week’s revised figure of 376,000. The four-week moving average was 376,500, a decrease of 9,750 from the previous week’s revised average of 386,250.
The Administration also reported that the total number of insured unemployed Americans for the week ending June 30 dipped to 3.304 million, a decrease of 14,000 from the preceding week’s revised level of 3.318 million. The four-week moving average was 3,308,500, an increase of 1,250 from the preceding week’s revised average of 3,307,250.
Manufacturing and Trade
Turning to trade, the Census Bureau and Bureau of Economic Analysis jointly reported last week that total May exports of $183.1 billion and imports of $231.8 billion resulted in a goods and services deficit of $48.7 billion, down slightly from April’s revised deficit of $50.6 billion. May exports were $0.4 billion more than April exports of $182.7 billion. May imports were $1.6 billion less than April imports of $233.3 billion.
In May, the goods deficit decreased $1.6 billion from April to $63.5 billion, and the services surplus increased $0.3 billion from April to $14.8 billion. Exports of goods were virtually unchanged at $130.7 billion, and imports of goods decreased $1.6 billion to $194.3 billion. Exports of services increased $0.3 billion to $52.4 billion, and imports of services increased $0.1 billion to $37.5 billion.
On an annual basis, the goods and services deficit increased $1 billion from May 2011 to May 2012. Exports were up $7.4 billion, or 4.2 percent, and imports were up $8.4 billion, or 3.8 percent.
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