U.S. household debt hit a new all-time high in late 2022, driven in part by increased credit card use, but inflation and higher interest rates pose default risks .
The total amount of US household debt was $16.9 trillion in the fourth quarter of 2022, according to New York Fed data released Thursday.
That's $394 billion, or 2.4%, more than in the third quarter, and $2.75 trillion more than at the end of 2019, before the Covid-19 pandemic hit the global economy. .
Outstanding credit cards - widely used in the United States for all types of purchases - are 986 billion dollars.
Those of home loans thus amounted to 11.920 billion dollars.
But the sharp increases in the rates of these loans since the beginning of 2022, in response to the hikes in the rate of the American central bank (Fed) to curb high inflation, have slowed down new mortgages, “after two years of historically high volumes
”
.
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"Home loan issuance, which includes refinancing, fell to $498 billion in the fourth quarter, representing a return to lower levels last seen in 2019," the New York Fed said
.
And the share of debt that has not been repaid
“increased again in the fourth quarter for almost all types of debt, after two years of historically low defaults”
, it is specified.
“While historically low unemployment has kept consumer finances generally strong, stubbornly high prices and rising interest rates may test the ability of some borrowers to service their debts”
, commented Wilbert van der Klaauw, economic research adviser at the New York Fed, quoted in the press release.