US credit card debt tops $1 trillion – report

Lazy eyes listen


Credit card balances in the United States increased by $45 billion in the second quarter, reaching $1 trillion for the first time, according to the New York Federal Reserve Bank.

According to the bank’s experts, delinquency rates have now returned to pre-Covid levels, with the two most recent quarters “appearing to show some stabilization.”

Other balances climbed by $15 billion and $20 billion, respectively, for retail credit cards and other consumer loans, as well as vehicle loans.

According to the quarterly data, student loan balances declined by $35 billion to $1.57 trillion, while mortgage balances remained essentially steady at $12.01 trillion.

In the second quarter of 2023, total household debt increased by $16 billion to $17.06 trillion.

Despite the various headwinds that American consumers have encountered in the last year – increased interest rates, post-pandemic inflationary pressures, and recent banks failures – the researchers found “little evidence of widespread financial distress for consumers.”

According to Fed data, more than 70 million new credit card accounts have been opened since the start of the coronavirus outbreak.

Financial experts anticipate the debt will continue to accumulate, in part because high inflation has forced consumers to rely more heavily on credit cards to cover expenses.