U.S. consumer credit fell in July for the first time in nearly a year as Americans reduced credit card debt, a worrisome sign for the U.S. economy which has struggled to create jobs.
Consumer credit shrank by $3.28 billion in July, the Federal Reserve said on Monday. That was well below the $9.1 billion advance Wall Street economists had forecast in a Reuters poll.
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However, in a more positive sign, the Fed revised substantially higher its estimate for credit growth in June.
Credit has been expanding almost continuously since mid-2010 as the country recovered from the 2007-2009 recession. The decline in July was the first drop since August of last year.
In July, revolving credit, which includes credit cards, shrank by $4.82 billion.
Non-revolving credit increased by $1.55 billion.
Consumer credit flows -- a relatively new data series that the Fed says is more sensitive to economic trends -- also cooled. The flow of consumer credit fell at an annual rate of $39.3 billion in July. (Reporting by Jason Lange; Editing by Andrea Ricci)