Forex: U.S. Consumer Credit Rose by $14.2 Billion in October; USD/JPY Neutral
THE TAKEAWAY: [U.S. Consumer Credit Jumps by $14.2B] > [Increase in borrowing for student loans and autos] > [USD/JPY neutral]
According to Federal Reserve report today, U.S. consumer credit increased more than forecast in October. The reading of consumer credit came out at 14.2 billion, following an upward revision to a $12.2 billion gain from an increase of $11.4 billion initially reported. The median forecast of 36 economists surveyed by Bloomberg News had called for a $10.0 billion rise.
Revolving debt, which includes credit cards, climbed by $6.2 billion, while non-revolving debt, which includes educational and auto loans, increased by $4.7 billion.
Today’s report showed that lending by the federal government, which is mainly for educational loans, increased by $6.9 billion to $516.4 billion. In addition, the improving housing market, combined with reducing joblessness, has helped consumers to gain confidence and therefore to take on more debt for purchases.
The U.S. dollar remained little change against Japanese yen in the minute after the release of the U.S. Consumer Credit. At the time this report was written, the USD/JPY pair was trading at 82.43 yen.
--- Written by Renee Mu, DailyFX Research
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