PLANO, Texas (3/26/12)--Credit unions likely won't see any immediate impact soon on loan demand, even though the Labor Department reports new claims for unemployment benefits totaled 348,000 for the week ending March 17, says Brian Turner of Catalyst Strategic Solutions.
Downward trends in unemployment and benefit claims are positive signs for alleviating what is putting a damper on consumer spending and economic growth, noted Turner in the Texas Credit Union League newsletter, LoneStar Leaguer (March 23). Catalyst is an arm of Catalyst Corporate FCU.
Upward trends lately have helped increase consumer confidence, but that is not enough to entice most people to open their wallets, Turner said. Consumer spending continues to be on a 1.4% annualized pace, far from the 2.6% pace at the same time a year ago. Retail sales are at a 6/5% pace, down from 7.5% annual pace this time last year.
If the nation can continue to experience stability in benefit applications, credit unions could potentially see loan demand turn around sooner than most anticipate, Turner said. Until that time, however, "we can expect a few more vehicle loan applications to come in and certainly a steady flow of mortgage refi applications," he concluded.