The Globe and Mail reports in its Wednesday edition that some red flags emerged for the United States economy late last year that could signal an imminent downturn.
A Reuters dispatch to The Globe reports that the U.S. household debt and credit report, published Tuesday by the Federal Reserve Bank of New York, showed that the overall debt shouldered by Americans climbed to a record $13.5-trillion in the fourth quarter of 2018 (all figures U.S.). It has risen consistently since 2013.
While mortgage debt slipped for the first time in two years, other forms of borrowing rose including that of credit cards, which at $870-billion matched its precrisis peak in 2008.
Consumer spending accounts for two-thirds of growth in the U.S. and it is expected to hold strong this year even as the overall expansion cools after a hot 2018.
However one sign of consumer demand, credit inquiries, slipped in the second half of 2018 to the lowest level recorded by the New York Federal Reserve.
Another signal of weaker demand, the closing of credit cards and other accounts, jumped to its highest level since 2010, while flows into serious delinquency for credit cards rose 5 per cent, up from 4.8 per cent in the third quarter.
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