May SpendTrend shows rise in credit card spending
First Data Corp.'s May 2011 SpendTrend report demonstrates a softer economy in May this year compared with May 2010. The report shows year-over-year volume growth in credit card spending was down 6.6 percent in May 2011, the lowest monthly growth so far this year; the year-over-year transaction growth of 5.5 percent is the slowest growth reported in the past year.
However, those who did use credit cards spent more. The study indicates credit card dollar volume growth rose by 8.8 percent. Credit card spending growth was larger than both PIN debit and signature debit spending in May.
"Higher-end consumers are utilizing credit and paying off the balances, while lower-end consumers are turning to credit to cover everyday expenses," the study reported.
Buying increased 1.4 percent over the previous May. It was slightly higher than April 2011, and it was the largest increase in the rate of consumer spending so far this year. When gasoline costs are excluded, however, the average consumer purchase increased only 0.5 percent over the previous year, though every industry sector with the exception of restaurants and grocery stores saw a rise in spending.
First Data Information and Analytics Solutions Division Manager and Senior Vice President Silvio Tavares said, "Card spending growth slowed in May. High gas prices and stubbornly high unemployment constrained growth in most merchant categories."
First Data's SpendTrend follows credit card, signature debit, PIN debit and electronic benefit card same-store consumer spending trends in the United States.
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