Household debt hit a new record high in the second quarter of 2017, and credit card delinquencies are on the rise, according to a new report from the Federal Reserve Bank of New York on Tuesday.
Tuesday's report marked the first time since 2009, when the country was still reeling from the financial crisis, that the economy saw a year-over-year rise in people falling behind on credit card payments. Economists at the New York Fed called the rise in credit card delinquency "potentially concerning, particularly in the context of a strong economy and low interest rates."
Total household debt rose $114 billion in the second quarter to $12.84 trillion, according to the report, eclipsing the previous all-time peak set in the first quarter.
Record household debt isn't necessarily a bad thing. Researchers at the New York Fed noted that, unlike in 2008 when the level of debt first approached $13 trillion, there isn't a lot of questionable mortgage debt this time around.
But the rise in credit card delinquency, particularly a sharper uptick in the number of lower-credit borrowers more than 90 days behind on payments, is something to monitor because it should not be expected in a still-recovering economy that is adding jobs, the bank's economists said. A separate report released by the Fed's Board of Governors last week suggested that credit card debt hit a new record high in August.
The New York Fed's report is based on anonymized data taken from a credit reporting company.
The release also showed aggregate student debt flat at $1.34 billion, and the delinquency rate for student loans rose to 11.2 percent in the quarter.