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Families pull consumer credit to meet vacation expenses

Date: May 26, 2024 Time: 06:47:48

Families continue to use consumer credit despite the uncertainty surrounding the economy due to the impact of the rise in interest rates. According to data from the Bank of Spain for the month of June, loans for household consumption will increase by 3.7% interannual to 97,061 million euros. Although from May to June it has experienced an increase of almost 1%. In total, the credit granted to families stood at 699,234 million euros.

In the first six months of the year, consumer credit has followed an upward trend, going from 95,480 million euros to 97,061 million euros in this type of loan, which represents an accumulated increase of 1,581 million euros. In the year the increase was 1.6% and stands at the highest level in recent years as households choose to draw on loans rather than cut spending due to the loss of purchasing power. This has contributed to the fact that the interest rates applied to consumer loans remain contained compared to the increase in the Euribor.

Thus, and for the month of May of this year, the TEDR rate for new operations, which exclude associated expenses, was 7.96% compared to 6.64% a year ago, while that of mortgages has passed from 1.65% in May 2022 to 3.71%. Likewise, this type of loan has been rising for twelve months now, registering small falls in August 2022 and February of this year.

For their part, families continue to reduce the volume of credit allocated to home purchases. In this sense, the fall has been 1.4% year-on-year and that is that families, and given the rise in the Euribor that closed in June at a monthly rate of 4%, have chosen to repay their real estate loans early. Thus, housing credit closed in June at 503,364 million euros, the total volume of credit being one of the lowest in recent years.

In fact, from May to June, the volume has experienced a drop of 1,237 million euros, that is, 0.24% less.

As for financing to companies, the decrease was 2.5%, to 923,447 million, according to data published this Tuesday by the Bank of Spain. However, compared to the previous month, credit to companies practically stagnated, with a balance reduction of 0.04%, while financing to families grew by 1.44%.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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