Inflation fears cuts credit card spending

In a survey conducted by the Melbourne Institute only 13.4 per cent of respondents said that they think that inflation will drop to within the Reserve Bank's target band of 2 to 3 per cent. With the Reserve Bank this week forecasting inflation to be at 3 per cent or above over the next year it seems that consumers are becoming more cautious. The average credit card balance in September dropped by $6 to $2,993, still 5.5 per cent above last year but the rate of growth is the slowest in the past two years. Credit card cash advances are down by 8.7 per cent over the year and repayments have increased by 4.3 per cent.