Economic Snapshot: Total Consumer Credit Outstanding

Third Quarter 2006

Q4-05 Q1-06 Q2-06 Q3-06
Growth Rate-Real Domestic Product 1.8% 5.6% 2.6% 1.6%*
Inflation Rate-Consumer Price Index 3.2% 2.2% 5.0% 2.9%
Civilian Unemployment Rate 4.9% 4.7% 4.6% 4.7%

* Advance Estimate



What do the shaded areas in the graph indicate?

The shaded areas indicate recessions as determined by the National Bureau of Economic Research (NBER). A recession is a significant decline in economic activity spread across the economy, lasting more than a few months and normally visible in real GDP, real income, employment, industrial production and wholesale-retail credit. For additional information about the criteria NBER uses to determine recessions, visit


What types of credit are included in the consumer credit data?

Both revolving and non-revolving credit are components of these data. Revolving credit allows borrowers to use or withdraw funds up to a pre-approved credit limit. The amount of credit available to borrowers decreases as funds are borrowed, and the amount of credit available to borrowers increases as funds are repaid. Borrowers may repay the borrowed amount in full at any time. Borrowers may also repay over time; the repayment is subject to minimum payment requirements. Examples of revolving credit include credit cards and lines of credit.

Non-revolving credit involves a contract agreement in which a down payment or trade-in is usually made. A predetermined amount is paid periodically until the entire debt is paid. Finance charges are added to the price and are included as a portion of the payment. Examples of non-revolving credit include home mortgage loans and automobile loans.


With the exception of the recession that occurred from March 2001 through November 2001, what do you observe about consumers' use of credit during recessions?

During most recessions, growth of consumer credit tended to flatten out, which indicates that consumers' use of credit did not increase at as a great a rate as it did during expansions.


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