Credit card, mortgage and autopayment delinquencies are on the rise as household savings, which pandemic-era stimulus initially padded, have dropped.
Outstanding bank card balances hit $851.4 billion, up 18.1 percent from the same period last year, according to the financial data company Equifax.
Ninety-day delinquency on credit cards has also increased to 5.1 percent, up from 3.4 percent in the second quarter of last year, according to Federal Reserve data.
“The steady increase in delinquencies for three consecutive quarters signals stress on consumer ability to repay balances on general-purpose credit cards,” Herman Poon, a senior director at Fitch, wrote in a July analysis of consumer behavior.
Credit card debt and other revolving loans topped $1 trillion in August.
There’s also been an uptick in delinquencies, although economists say this is a sign the economy is rebalancing after the pandemic as opposed to an impending downturn.
“It is unfortunate, but it is not a big warning sign for the economy,” economist Dean Baker with the Center for Economic Policy and Research told The Hill.
“The rising rates of delinquencies are just bringing them back to where they were before the pandemic, when the economy was very strong by most measures,” he said.
The Hill’s Tobias Burns has more here.
