Survey: Credit card interest rates stay at 14.92 percent for 2nd week

By's Weekly Rate Report
  Avg. APR Last week 6 months ago
National average 14.92% 14.92%
Low interest 10.37%
10.37% 10.37%
Cash back 14.94%
Balance transfer 12.73%
Business 12.85%
Student 13.14%
Airline 15.52%
Reward  14.90%
Instant approval 23.33%
Bad credit 22.73%
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: Dec. 24, 2014

Average rates on new credit card offers held steady this week, according to the Weekly Credit Card Rate Report.

The national average annual percentage rate (APR) remained at 14.92 percent Wednesday after declining from 14.95 percent the previous week.

None of the cards tracked by advertised new interest rates. As a result, the national average APR remained at its lowest point in more than two years. The last time average rates were this low was in July 2012, when the national average hit 14.91 percent. 

Most issuers left promotional terms unchanged, as well. Capital One introduced an interest-free balance transfer offer to one of its cash-back cards for consumers with average credit. Applicants who qualify for the QuicksilverOne Rewards card now have nine months to take advantage of interest-free balance transfers. Cardholders are also offered nine months of interest-free purchases. 

Increased spending jump-starts GDP
The U.S. economy grew at a surprisingly fast clip last quarter, according to figures released Tuesday by the Commerce Department, thanks in part to increased consumer spending.

According to revised estimates, GDP climbed 5 percent between July and September, surprising economists who expected a more modest uptick. Economists polled by Bloomberg News predicted that GDP would increase by 4.3 percent. Previously, the Commerce Department estimated that GDP grew by 3.9 percent.

The third quarter's robust expansion is the single largest quarterly gain the Commerce Department has recorded in 11 years, fueling speculation that the economy may be finally gaining steam. The last time the economy expanded this quickly was in the third quarter of 2003, when GDP grew by 6.9 percent.

Robust consumer spending helped fuel last quarter's expansion, said the Commerce Department. According to the report, consumer spending rose by 3.2 percent last quarter after increasing by just 2.5 percent the previous quarter. The boost in spending was larger than previously estimated, said the Commerce Department, helping bolster the increase in GDP. Consumer spending drives the majority of economic growth in the U.S. and so has an outsized influence on GDP. 

Consumers spent substantially more on durable goods, such as washing machines and cars. For example, spending on durable goods was up 9.2 percent last quarter. Consumers also spent slightly more on nondurable goods, such as clothing, and on services.

Additional research released Tuesday showed that consumers continued to increase their spending through at least part of the fourth quarter as well -- raising analysts' hopes that GDP will continue to accelerate through the rest of 2014.

For example, consumer spending jumped by more than half a percent in November -- 0.6 percent total -- after increasing by 0.3 percent in October.  November's increase in spending is the largest monthly gain the Commerce Department has recorded since August.

Consumers' incomes also rose last month, according to the Commerce Department, giving holiday shoppers more room to spend. According to the department's latest report, personal income rose by 0.4 percent in November, which is the most wages have grown since June.

Last month's increase in consumer spending and income is good news for credit card issuers, as it could indicate that cardholders' finances are on the mend, despite years of slow economic growth. Consumers are not only in a better position to spend in 2015; they may also be more willing to charge larger amounts to their cards.

See related: Card borrowing lags while student, auto loans soar

Published: December 24, 2014

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