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Credit cards held in check
By DAVID HARGREAVES - BusinessDay.co.nz | Monday, 26 January 2009
Kiwis kept the tightest rein on their credit cards for many years
this Christmas, new Reserve Bank figures out today suggest.
Amounts owed on credit cards dropped a seasonally adjusted 0.8 per
cent in December compared with the previous month - the largest
monthly drop in amounts owing for over 10 years.
The figures, following on from lower electronic card transaction data
in December released last week by Statistics New Zealand, are further
evidence of an extremely subdued Christmas for retailers.
Anecdotal evidence has pointed to reasonable numbers of retail sales
transactions - but that people were spending less. Official retail
figures for December will be released next month.
According to the Reserve Bank a seasonally adjusted $5.23 billion was
owed on cards by the end of December, down from $5.27 billion in November.
After hitting the $5 billion mark for the first time last December -
which was close to double what the figure was at the start of the
decade - the credit card balances have hovered around the $5 billion
level for the rest of the year.
On an unadjusted basis, the latest figures showed $5.46 billion was
owed on cards at the end of last month, up from $5.21 billion at the
same time the previous year.
The RBNZ said that the average interest rate on credit cards in
December was 19.7 per cent, down from the peak level of 20.2 per cent
seen from May through to November.
The reductions in interest rates are much less than those seen in the
official rates, which have been reduced by the RBNZ to 5 per cent
from 8.25 per cent in July and for fixed term mortgages, which have
fallen by in the region of 2 to 3 percentage points.
By DAVID HARGREAVES - BusinessDay.co.nz | Monday, 26 January 2009
Kiwis kept the tightest rein on their credit cards for many years
this Christmas, new Reserve Bank figures out today suggest.
Amounts owed on credit cards dropped a seasonally adjusted 0.8 per
cent in December compared with the previous month - the largest
monthly drop in amounts owing for over 10 years.
The figures, following on from lower electronic card transaction data
in December released last week by Statistics New Zealand, are further
evidence of an extremely subdued Christmas for retailers.
Anecdotal evidence has pointed to reasonable numbers of retail sales
transactions - but that people were spending less. Official retail
figures for December will be released next month.
According to the Reserve Bank a seasonally adjusted $5.23 billion was
owed on cards by the end of December, down from $5.27 billion in November.
After hitting the $5 billion mark for the first time last December -
which was close to double what the figure was at the start of the
decade - the credit card balances have hovered around the $5 billion
level for the rest of the year.
On an unadjusted basis, the latest figures showed $5.46 billion was
owed on cards at the end of last month, up from $5.21 billion at the
same time the previous year.
The RBNZ said that the average interest rate on credit cards in
December was 19.7 per cent, down from the peak level of 20.2 per cent
seen from May through to November.
The reductions in interest rates are much less than those seen in the
official rates, which have been reduced by the RBNZ to 5 per cent
from 8.25 per cent in July and for fixed term mortgages, which have
fallen by in the region of 2 to 3 percentage points.