Part 5/8:
When considering delinquency rates across all loans at commercial banks, the percentage stands at 1.68%. Although this figure is on the rise, historical analysis reveals that the trend has been downwards for the past four decades, excluding the financial crisis spike. However, this statistical perspective offers little solace for the individuals grappling with overwhelming debt in the present.
Shifting Spending Habits
With increasing delinquencies, consumer behavior is being impacted significantly. Recent changes in real personal consumption expenditures indicate a sharp drop in spending. As households allocate more of their incomes towards debt payments, spending on basic goods and luxuries has declined notably.