An American Bankers Association survey revealed that late late payments on debt soared to a 15 year high in Q4, growing 21 basis points to 2.65% of payments. Delinquent bank card accounts grew to 4.38%. The steep rise in delinquencies is the latest indication that consumers are struggling to make ends meet, and doesn’t auger well for the economy, two thirds of which relies on consumption. Commenting on the weakness, Nigel Gault, director of U.S. research at Global Insight said:
It’s an indication of the degree of stress consumers are facing right now. People overextended themselves, they took out loans they thought weren’t a problem as long as house prices kept rising.
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