WASHINGTON -- CUNA Chief Economist Bill Hampel has grabbed hold of the mainstream media lately in all the hoopla over slower consumer spending and is using the time to put credit unions on the map.
In a Feb. 15 USA Today article on recent consumer spending trends, Hampel explained that he had been pleasantly surprised by a year-end up tick in savings at credit unions. "For much of the year we'd been telling credit unions, 'It looks like we're on track for the slowest growth year at credit unions since World War II.' The last quarter of the year, it picked up," he commented for the report.
The article appeared th same week as Federal Reserve Chairman Ben Bernanke's testimony before the Senate Banking and House Financial Services Committees that while things may slow, there will still be growth.
The USA Today piece also ran the week retail sales data were released, which remained, which remained unchanged in January. According to NAFCU's Macro Data Flash, retail sales excluding light vehicles grew 0.3% while core retail sales, which also exclude gasoline, increased 0.5%. The year-over-year data portrayed a large difference with 2.3% growth from January 2006, down from 5.7% growth the month before.
NAFCU Senior Economist Jeff Taylor said that slower retail sales will be bolstered somewhat by income gains and cash out refinancings. This slower pace will drag real GDP down to 2.8% from 3.2% in 2006. "This, coupled with the softening of the housing market, will likely mean a moderate slowdown in loan demand for credit unions," he wrote.