Americans love putting things on the credit card. In fact, free-flowing credit was a hallmark of the “free money era” that came to a close with the Fed’s big rate hikes last year, when businesses had easy access to loans and individuals could always turn to a credit card in times of need. Then last month’s banking crisis shook confidence in the financial system and raised concerns that a “credit crunch” could slam the almighty American shopper and raise recession risk. And the survey data is mounting that the crunch hath arrived.
Consumer perceptions of credit availability nosedived in March, a Monday survey by the Federal Reserve Bank of New York found. The share of Americans reporting that credit is much or somewhat harder to come by than it was a year ago is now 58.2%, the highest since the Fed began recording data in 2013. Only 33% of Americans feel their access to credit is as easy or hard as it was a year ago, the lowest share since April 2020.
