Rising Inflation Pushes Credit Card and Car Loan Defaults to 10-Year High
Credit card and car loan defaults in the US have reached a 10-year high as inflation squeezes families. Low- and middle-income earners are particularly affected by rising prices, despite efforts by the Federal Reserve to control inflation. Credit card delinquencies have reached 3.8% and car loan defaults have reached 3.6%, the highest in over a decade. With savings from government stimulus checks depleted, many borrowers are opening new lines of credit to pay off debts, even as interest rates hit a record 20.6%. The resumption of student loan payments and the approaching holiday season raise concerns about further debt accumulation.