Record US Credit Card Balances Tip US$1 Trillion
(10 August 2023 – United States) The New York Federal Reserve reports aggregate US credit balances have surpassed US$1 trillion for the first time ever.
As US consumers increasingly reverted to “plastic” to make ends meet over the summer as the cost of living crisis deepens, total credit card indebtedness rose by US$45 billion in Q2 2023, an increase of over four percent taking the total value owed to US$1.03 trillion. This marks the highest gross value in Fed data stretching back two decades. The rise in credit card balances reflects both inflationary pressures and growing levels of consumption.
Demand for card issuance has weakened in conjunction with banks asserting that credit standards are tightening.
“Credit card balances saw brisk growth in the second quarter. And while delinquency rates have edged up, they appear to have normalized to pre-pandemic levels” stated New York Federal Reserve Regional Economic Principal, Joelle Scally.
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