Average rates on new credit card offers remained unchanged this
week, according to the CreditCards.com Weekly Credit Card Rate
The national average annual percentage rate (APR) remained at
14.99 percent Wednesday, after climbing the previous week for the
first time in more than two months.
Most issuers left credit card terms alone this week. The
sporting goods store Cabela's lowered the minimum APR on the
Cabela's Club Visa from 15.18 percent to 15.17 percent. However,
the change to the store card's APR wasn't big enough to dent the
Barclays was also active. For the third time in four weeks,
Barclays floated a new promotional offer on the US Airways Premier
Barclays introduced a 12-month, 0 percent purchase APR to the US
Airways card. In addition, Barclays shortened the airline card's
interest-free balance transfer offer from 15 months to 12
Cardholders remain wary
Credit card issuers, such as Barclays, are actively testing new
offers and sweetening their promotional deals in order to attract
more applications and encourage people to spend.
Cardholders, however, are showing little interest in spending
heavily on credit and are instead focusing on paying down the
balances they already have.
Consumer credit card balances, for example, shrank in July for
the second straight month, according to
from the Federal Reserve. Revolving debt -- which is mostly credit
card debt -- fell by 2.6 percent in July after falling by 5.2
percent the previous month.
Cardholders' shrinking balances underscore just how stubborn
many consumers have become about keeping their finances in check.
Despite slow but steady economic progress -- including the lowest
unemployment rate in nearly five years -- many consumers remain
exceptionally careful about the amount they're willing to
The good news for issuers is that fewer cardholders are falling
behind on payments, according to multiple reports. However,
cardholders' ongoing unwillingness to spend, five years after the
2008 financial crisis, is making it hard for card issuers to
increase their revenue. It's also helping to drag down the economic
recovery, which depends heavily on consumer spending.
According to a report released Aug. 30 by the Commerce
Department, consumer spending of all types rose a measly 0.1
percent in July -- well below economists' expectations.
Job market weak, but on the mend
Employers, meanwhile, are gradually increasing the number of jobs
they add to the economy. However, they're still not adding nearly
as many jobs as economists hoped.
Employers from both the private sector and the public sector,
for example, created 169,000 new jobs in August, according to new
data from the
. The unemployment rate, meanwhile, dipped to 7.3 percent -- its
lowest level since December 2008.
Despite those positive figures, economists pointed out that last
month's drop in the unemployment rate was due, in part, to large
numbers of people giving up on finding work.
The Commerce Department also reported on Friday that the average
number of jobs being added to the economy is substantially lower
than previously estimated.
According to revised figures released Sept. 6, employers added
just 104,000 jobs in July. That's 58,000 less than the number of
jobs the Labor Department previously reported.
Meanwhile, in June, employers added approximately 172,000 jobs
-- 16,000 fewer jobs than the Labor Department estimated.
A second report, released Sept. 5, showed similar results.
According to the payroll company ADP, private sector employers
created 176,000 new jobs in August -- slightly more than the total
number of jobs that the Labor Department estimated.
The service sector created most of the new jobs in August, said
ADP. Employers that produce tangible goods added just 11,000 jobs
ADP analysts say that the number of jobs created in August is
similar to previous months. "The August job gains are in line with
the monthly average over the last 12 months," said ADP's Carlos
Rodriguez in a
accompanying the report.
Employers are steadily adding jobs. They're just not adding as
many jobs as economists are calling for in order to hasten the
In the same press release, Mark Zandi, an economist at Moody's
Analytics, also noted that outside events that could have caused
employers to pause their hiring aren't having as much of an impact
as some analysts feared, which is good news for consumers.
"It is steady as she goes in the job market," said Zandi. "There
is little evidence that fiscal austerity and Health Care Reform
have had a significant impact on the job market."
CFPB: Consumers' side of credit disputes must be