The miracle that is the post-pandemic US economy keeps chugging along, but there’s a big problem just below the surface, and it’s only getting bigger: debt. Outstanding US consumer debt surged by the most on record in December, reflecting massive increases in credit-card balances and non-revolving credit. Total credit jumped $40.8 billion, according to Federal Reserve data released Friday. The figure, which isn’t adjusted for inflation, topped all estimates in a Bloomberg survey of economists.
Outstanding credit-card and other revolving debt increased $22.9 billion in December, more than reversing the prior month’s decline. Non-revolving credit, such as loans for vehicle purchases and school tuition, climbed $18 billion, the most in two years. The delinquency rate has risen, too, with some 3.5% of card balances past due by 30 or more days and 1.8% of accounts delinquent. Both figures are more than double the post-pandemic lows recorded in 2021.