The rise of inflation is directly impacting consumer credit card debt, causing it to significantly increase in the United States. According to a recent report from the Federal Reserve, consumer credit card debt is at an all-time high of over $1 trillion, surpassing the previous record set in December 2008.
The main factor driving this surge in debt is the rising cost of inflation. When prices for essential goods and services increase, households have no choice but to borrow more to cover their expenses. This is why consumer credit card debt has skyrocketed.
In addition to increasing inflation, unemployment is also playing a role in driving up credit card debt. With the unemployment rate still steadily ticking up, many people are unable to find jobs and are relying on their credit cards to cover their living expenses. This piles on to the existing pile of consumer debt, exacerbating the problem even further.
Given that there is no end in sight to the inflationary crisis, it’s only a matter of time before the total amount of consumer credit card debt surpasses the staggering $1 trillion mark. With more people turning to their credit cards to make ends meet, there’s no question that this number is only going to keep growing.
Fortunately, the government has taken steps to help ease the burden of consumer credit card debt. Laws have been passed that regulate interest rates and other fees associated with credit cards, which can help consumers save money. Additionally, the Federal Reserve has lowered interest rates in order to put downward pressure on consumer debt.
It’s clear that the rising cost of living has had a significant impact on consumer credit card debt. Although these measures may help alleviate the situation in the near term, the best way to address the problem is to tackle the root cause — inflation.