Credit Cards: Willing but not Able

--  U.S. households have deleveraged and built a cash stockpile, making them able to re-leverage to accelerate consumption.  Despite having plenty of available credit, consumers are shunning credit cards debt even as they ramp up their card transactions for online purchases.

--  Developments in expected income and sentiment point towards a decline in revolving credit leverage.  However, they leave open the question of whether the reduction is likely to be permanent.

--  Banks significantly reduced new card limits in 2020, but they did not increase credit spreads.  By limiting exposure to potentially desperate borrowers, banks did not need to squeeze customers for higher spreads to cover losses.