There are a lot of interesting details embedded in this number, specifically how strong consumer spending was.
I still have concerns about dwindling savings and increasing credit balances, as well as historically high APRs, but will worry about that another day.
I think credit card APRs specifically are off the charts. Other forms of credit (mortgages etc) not so much. Credit card issuers are commanding a 15% margin over prime rate, while charge-off i.e. the risk to the credit issuer is around 3%, near all-time lows. In other words credit issuers are raking in record unearned profits.
This FRED series only goes back 30 years but if you look at the Fed Statistical Abstract consumer credit tables, APRs in 1985 were < 19% and in 1980 were < 18% so 21% and higher are very exceptional.
Consumer is tapped out, economy is flashing yellow warning light and the Fed needs to cut now. Lots of spending currently being driven by Boomers running off of assets and paying cash (~40% of consumer spending), but there is only so much of that. Per the Sahm rule and rising unemployment, we are approaching recession territory and the potential for a self reinforcing consumer demand destruction spiral (people lose jobs, pull back spending, more people lose jobs, even more spending gets pulled back, and so forth).
I still have concerns about dwindling savings and increasing credit balances, as well as historically high APRs, but will worry about that another day.