US Household Debt Sees First Decline in Six Years
US household debt declined for the first time in six years in the second quarter, according to new data from the Federal Reserve Bank of New York. The total debt fell by $13 billion from the previous quarter to $18.77 trillion, with $226 billion adjusted for inflation.
The average household owed more than $155,000 at the end of the second quarter, about $17,000 below the record high. As a share of the economy, household debt has been steadily declining since the post-pandemic spike, falling to around 68 percent.
While mortgage balances dropped by $74 billion to $13.1 trillion, auto loan debt jumped by $28 billion to $1.71 trillion, and credit card balances rose by $21 billion to $1.26 trillion.
Ted Rossman, principal consumer finance analyst at Money Management International, said 'These statistics reflect a slowing economy, a trend also evident in other recent figures such as GDP growth and the job market.'