Credit card interest rates hold steady at 14.95%
|CreditCards.com's Weekly Rate Report
||6 months ago
|Methodology: The national average credit card APR is comprised of 100 of the most popular credit cards in the country, including cards from dozens of leading U.S. issuers and representing every card category listed above. Introductory, or teaser, rates are not included in the calculation.
|Updated: Aug. 21, 2013
rates on new credit card offers remained at 14.95 percent Wednesday, according
to the CreditCards.com Weekly Credit Card Rate Report.
left interest rates alone this week. However, not all credit card terms
remained the same.
American Express, for example, lengthened the promotional APR period on three of its
flagship credit cards: the Blue Cash Everyday card, the Blue Sky card and the
Blue card. Applicants for all three cards may now qualify for a 0 percent APR
on purchases for up to 15 months. The issuer also introduced a 15-month, 0
percent balance transfer offer to each card.
meanwhile, canceled a test offer on the US Airways Premier World MasterCard.
The issuer eliminated the card's 12-month introductory APR after introducing
the promotional offer last week. In addition, Barclays extended the World
MasterCard's 0 percent balance transfer period from 12 months to 15 months.
Consumer confidence flags
card issuers have been testing new promotional offers more over the
past several months in order to attract new cardholders.
despite better offers from some card issuers, consumers may not be in the
spending mood, according to new research from the University of Michigan and
preliminary consumer confidence reading released Aug. 16 showed that consumer
sentiment dropped in August to its lowest point since April, according to
drop in expectations surprised economists who predicted that consumers would be
feeling much more optimistic as the summer neared to an end. According to
Reuters, economists predicted that the University Michigan Thomson Reuters
Consumer Sentiment Index would hit 85.5 in August. Instead, a preliminary
reading shows it fell from 85.1 to 80.
last month, consumer confidence surged to a six-year high as a record number of
consumers told researchers that they were were feeling increasingly optimistic
about the economy's underlying strength.
bullishness wavered in August, however, as a significantly larger number of consumers
expressed skepticism about the current state of the economy and said that
economic growth is likely to slow in the months ahead.
In a statement released to Reuters, Surveys of
Consumers Chief Economist Richard Curtin said that rising interest rates on
long-term loans, such as mortgages, is partially to blame for this newfound
lenders have hiked long-term interest rates over the past few months, according
to Reuters, in order to prepare for expected changes to the Federal Reserve's
aggressive economic stimulus programs.
2008, the Federal Reserve has enacted a number of rate-lowering policies, such
as setting the federal funds rate target near zero, in order to encourage
businesses and consumers to take out more loans.
insists it won't raise the federal funds rate target until the unemployment
rate falls below 6.5 percent. However, as the economy slowly strengthens, many
analysts expect that the Fed will soon begin walking back several other
expansionary policies, such as the Fed's aggressive bond buying program.
expectation has prompted prospective borrowers to seriously
consider buying a new home or car before interest rates go up, according to a survey released in July by Reuters and
the University of Michigan.
Back-to-school shoppers hit malls
feeling increasingly pessimistic about the economy, consumers are still
visiting nearby retailers this summer for back-to-school supplies, according to
the National Retail Foundation, which tracks back-to-school sales. However,
they're being careful about what they buy -- and what payment method they use
to purchase new items.
to a survey released Aug. 20, a significantly larger number of shoppers had
already completed at least half of their back-to-school shopping this summer as
they try to spread out their purchases and compare prices. "Shopping early and often has become a sign of the times
as budget-conscious consumers aim to ease the brunt of large spending
events," said NRF President and CEO
Matthew Shay in a statement.
addition, more consumers are using sales and promotions
to help them shop this summer, and many are planning to use cash, rather than
credit, to finance their purchases.
According to the survey, the majority of respondents told
researchers that they plan to use a debit card or cash to pay for their remaining
back-to-school expenses. Fewer than 20 percent say they plan to use a credit
See related: NY Fed: Debt squeeze eases on households, Fed: Card balances fell in June
Published: August 21, 2013
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