WASHINGTON, Aug 3 — US household debt topped US$16 trillion (RM71.3 trillion) in the second quarter as rising prices led to a surge in the mortgage, auto loan, and credit card balances, Sputnik quoted a report by the Federal Reserve Bank of New York on Tuesday.
“The report shows an increase in total household debt in the second quarter of 2022, increasing by US$312 billion (2 per cent) (RM1.39 trillion) to US$16.15 trillion (RM71.9 trillion),” the Fed said in a press release accompanying the report. “Balances now stand US$2 trillion (RM8.9 trillion) higher than at the end of 2019, before the Covid-19 pandemic.”
The data comes as the highest rate of inflation in 40 years continues to affect Americans. The Bureau of Economic Analysis in a report last week said the US saw inflation jump 9.1 per cent, year-over-year, in June with consumer spending rising 1.1 per cent fuelled by gasoline prices which stood at US$5 – US$6 (RM22.29 to RM26.74) a gallon.
New York Fed Microeconomic Data Centre Administrator Joelle Scally said rising prices drove robust increases in mortgage, auto loan, and credit card balances in the second quarter of 2022.
Balances for credit cards increased to US$46 billion (RM205 billion) and auto loans to US$33 billion (RM147 billion). Other balances, including retail cards and consumer loans, increased by a robust US$25 billion (RM111.4 billion), the release said.
The 13 per cent cumulative increase in credit card balances since the same quarter in 2021, the release added, marks the largest in more than 20 years.