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Market Minute: Household stress evident in rising delinquencies

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While the consumer price index in April reflected scant evidence of tariff-induced inflation, signs of financial stress are starting to show up in American households.

In particular, the number of people who are 90 or more days delinquent in their loan payments is rising as we approach a period of rising prices because of tariffs.

These price increases will only add to the pressure on households as declining disposable incomes on the margin create difficult choices around maintaining credit obligations.

The U.S. Household Debt and Credit Report, published by the Federal Reserve Bank of New York, showed growing signs of stress in the first quarter of the year, particularly when it comes to credit cards and student loans.

Read more of RSM’s insights on the economy and the middle market.

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About Joseph Brusuelas

@JoeBrusuelas

Joe Brusuelas, “chief economist to the middle market,” is the preeminent voice championing issues and policies facing midsize companies in the United States and around the world. An award-winning economist, Brusuelas has more than 20 years’ experience analyzing U.S. monetary policy, labor markets, fiscal policy, international finance, economic indicators and the condition of the U.S. consumer.

A member of the Wall Street Journal’s forecasting panel and the UCLA Anderson School of Management's Board of Directors, Brusuelas regularly briefs members of Congress and other senior officials regarding the impacts of federal policy on the middle market and the factors by which middle market executives make business decisions. He also frequently offers his insights on the U.S., Canadian and global economies in the financial media. In 2020, he was named one of the 100 most influential economists by Richtopia. In December 2023, Brusuelas and the economics team were recognized on Bloomberg's list of Best Bond Forecasters after correctly predicting where the benchmark Treasury would end the year.

Before joining RSM in 2014, Brusuelas spent four years as a senior economist at Bloomberg L.P. and the Bloomberg Briefs newsletter group, where he co-founded the award-winning Bloomberg Economic Brief. Earlier in his career, he was a director at Moody's Analytics covering the U.S. and global economies for the Dismal Scientist website. He also served as chief economist at Merk Investments L.L.C. and chief U.S. economist at IDEAglobal.

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