The amount of US consumer credit card debt has surpassed $1 trillion for the first time.
The overall US consumer credit card debt is at its highest level over $1.03 trillion, according to the Federal Reserve Bank of New York’s quarterly report on household debt and credit, which was released on Tuesday.
The US consumer credit card debt climbed by $45 billion from the first quarter or 4.6%.
An increase of $145 billion, or 17%, was seen in the last quarter compared to the same period last year. Many economists were alarmed by the fact that the results from the previous quarter did not decline as typical.
Additionally, there has been an increase in the proportion of Americans who are overdue on their payments. According to a blog post by New York Fed analysts, although delinquency rates have now reached pre-Covid levels, the two most recent quarters appear to show some stabilization.
These rises coincide with a spike in interest rates that has brought them to a 22-year high.
A study of New York Fed data reveals that US consumer credit card debt has increased for five straight quarters, rising at some of the highest rates in the past 20 years.
During the second quarter, US consumer credit card debt shot up by $45 billion or nearly 4.6%, to land at $1.03 trillion, according to the New York Fed’s latest Quarterly Report on Household Debt and Credit.
According to LendingTree’s chief credit analyst Matt Schulz, the absence of a decline may not be favorable to US consumer credit card debt levels for the remaining portion of the year. It is probably a matter of time before the US Consumer credit card debt reaches $1 trillion for the first time since the New York Fed started keeping count because of rising interest rates, persistent inflation and a plethora of other economic reasons.
The total amount owed by American households is now $17.06 trillion due to the record breaking US consumer credit card debt.