May 8, 2020 - Economy & Business

Consumer borrowing plummets as Americans pull back credit card use amid coronavirus lockdowns

Data: FRED; Note: Chart shows flow of revolving consumer credit owned and securitized ; Chart: Axios Visuals

Americans pulled back on revolving credit — namely their credit card use — as states began to impose shelter-in-place orders, new data from the Federal Reserve shows.

Why it matters: It’s the latest indication of how the coronavirus is changing consumer behavior.

This data is closely watched. How much consumers borrow is an indication of how much they'll spend — a key driver of economic growth.

  • "We expect further declines in revolving credit in the months ahead as consumer spending continues to decline," Nancy Vanden Houten, senior economist at Oxford Economics, wrote in a note.

Go deeper: The emerging coronavirus economy

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U.S. coronavirus updates

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios. This graphic includes "probable deaths" that New York City began reporting on April 14.

About 40.7 million Americans have filed for unemployment since the coronavirus pandemic began, including 2.1 million more claims filed from last week.

Why it matters: Even as states reopen their economies, Americans are still seeking relief. Revised data out Thursday also showed U.S. economy shrunk by an annualized 5% in the first quarter — worse than the initially estimate of 4.8%.

Mark Zuckerberg: Social networks should not be "the arbiter of truth"

Photo: Drew Angerer/Getty Images

Facebook CEO Mark Zuckerberg argued on CNBC's "Squawk Box" Thursday that social media platforms should not police political speech, and that "people should be able to see what politicians say.”

Why it matters: Zuckerberg was responding to Twitter's decision this week to fact-check a pair of President Trump's tweets that claimed that mail-in ballots are "substantially fraudulent." Twitter's label, which directs users to "get the facts" about mail-in voting, does not censor Trump's tweets.

House Democrats pull FISA reauthorization bill

Speaker Nancy Pelosi. Photo: Saul Loeb/AFP via Getty Images

House Democrats pulled legislation Thursday that would have renewed expired domestic surveillance laws and strengthened transparency and privacy protections amid broad opposition from President Trump, House GOP leadership and progressive Democrats.

Why it matters: The failure to reauthorize the Foreign Intelligence Surveillance Act (FISA) comes as Trump continues to attack the intelligence community, which he claims abused the law to surveil his 2016 campaign and Trump administration officials.