US Household debt tops record $14 trillion amid multi-year low mortgage rate

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US Household debt tops record $14 trillion amid multi-year low mortgage rate

On Tuesday, the 11th of February 2020, the Federal Reserve Bank of New York had casted a gloomier outlook on a growing stockpile of US public debts, as US household debt had surpassed a record $14 trillion over the fourth quarter of 2019.

Aside from that, Tuesday’s (February 11th) NY Federal Reserve’s report came forth days after the US Federal Reserve had revealed in a research report that over the course of next ten years, US debts would be accountable for 98 per cent of its entire GDP (Gross Domestic Product), while a growing stockpile of corporate debts over the past couple of years following Trump’s radical monetary policy easing for the corporates had shored up the figures, suggested analysts.

Meanwhile, according to NY Federal Reserve’s Tuesday’s (February 11th) statement on US household debts, the American nationals had added roughly $193 billion in new debts over the fourth quarter of 2019, mostly stoked by a strident surge in mortgage loans amid a multi-year low interest rate following three interest rate cuts last year, while the overall debts of American nationals topped $14 trillion mark to reach a new peak of $14.15 trillion on record.

Besides, referring to an abrupt upsurge of mortgage loans in Q4, 2019, alongside a persistent pressure of auto loans throughout the year, Senior Vice President of New York Fed, Wilbert Van Der Klaauw said in a statement on Tuesday (February 11th), “Mortgage originations, including refinances, increased significantly in the final quarter of 2019, with auto loan originations also remaining at the brisk pace seen throughout the year.

The data also show that transitions into delinquency among credit card borrowers have steadily risen since 2016, notably among younger borrowers. ”