The post US Household Debt Soars to Record $17.8 Trillion – Fed Warns of Depleting Consumer Spending appeared on BitcoinEthereumNews.com.

The US household debt has reached unprecedented levels recently, raising concerns among major financial institutions about consumer stability. A recent New York Fed report indicates a significant increase in household debt, with credit card debt alone reaching $1.14 trillion. Bank of America CEO Brian Moynihan highlighted a noticeable slowdown in consumer spending, which he attributes to rising debt burdens and economic uncertainties. US Household Debt Hits Record High Amid Economic Concerns Increasing Household Debt and Its Implications Recent reports from the New York Federal Reserve reveal that aggregate household debt balances have surged by $109 billion in the second quarter of 2024, marking a 0.6% increase from the first quarter. This brings the total household debt to $17.80 trillion, up by $3.7 trillion since the end of 2019. This growing debt encompasses student loans, mortgages, credit card debt, and home equity revolving debt, reflecting the financial strain on American households. Rising Delinquency Rates The New York Fed’s data also points to a slight increase in delinquency transition rates for credit cards, auto loans, and mortgages during the same period. Approximately 4.9% of consumers now have a third-party collection account on their credit reports, suggesting a potential rise in financial distress among borrowers. This trend underscores the importance of monitoring the long-term implications of escalating debt levels. Consumer Spending Slowdown: A Cause for Concern In a recent interview with FOX Business, Bank of America CEO Brian Moynihan warned of a significant slowdown in consumer spending. According to Moynihan, the bank’s consumer base of 60 million customers is currently spending at an annual growth rate of around 3%, which is half of what it was compared to the previous year. This deceleration in spending is a critical indicator of the economic pressures facing consumers, despite their stable employment and income levels. Economic…

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Filed under: News - @ August 18, 2024 6:10 pm