Investing.com - Financial Markets Worldwide
Black Friday is Now! Don’t miss out on up to 60% OFF InvestingProCLAIM SALE

Is Consumer Deleveraging Over?

ByThe National Bank of Canada
Published 12/08/2011, 04:18 AM
Updated 05/14/2017, 06:45 AM

The U.S. economy has rarely done badly when its consumers were in spending mood. The acceleration in second half growth was largely a result of consumers finding back their mojo. The economic outlook for 2012 will again depend on what happens with consumers and there is reason to be optimistic on that front. In addition to getting support from an uptrending labour market, spending will also benefit from the apparent stabilization in consumer deleveraging. True, mortgage credit outstanding continues to drop, but it’s doing so at a slower pace. Moreover, as today’s Hot Chart shows, non-mortgage credit (even excluding student loans) registered in Q3 its first quarterly increase in three years, helped by rising auto loans. That together with the stabilization in the savings rate, is a sign that we may have seen the worst of the deleveraging process. Add to that a much reduced negative wealth effect from housing and it’s clear that American consumers offer much promise in 2012. Of course, a global recession and/or political shenanigans are potential obstacles to that promise being fulfilled.

U.S. Is consumer deleveraging over

Latest comments

Loading next article…
Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.