U.S. consumers are thriving by most measures, except this one

By many indicators, the American consumer is thriving. A new data point, however, offers a warning sign.

What's new: Delinquency rates for nearly all loans have been rising from the rock-bottom levels seen during the pandemic, according to data from the New York Fed released Tuesday.

• The upswing was perhaps inevitable, considering the end of generous government aid and debt forbearance.

Yes, but: The rebound in delinquencies, though, has been notable among credit card borrowers — a clear sign that consumers are pinched despite a still-healthy economy.

By the numbers: About 8% of credit card balances transitioned into delinquency by the end of September — a 0.8 percentage point increase in the prior quarter, Fed data showed.

• In the same period in 2020, when consumers were flush with pandemic-era stimulus, the figure was 5.7%.
• All loan types saw an upswing in delinquency rates last quarter, except for student loan debt and home equity lines of credit.

The big picture: "The continued rise in credit card delinquency rates is broad based across area income and region, but particularly pronounced among millennials and those with auto loans or student loans," Donghoon Lee, an economic research adviser at the New York Fed, said in a press release.

Details: In a blog post accompanying the report, the New York Fed found that Baby Boomers, Generation X and Generation Z have delinquency rates similar to pre-pandemic trends. Millennials credit card users, however, surpassed pre-COVID rates last year.

• The share of millennial borrowers newly delinquent in the third quarter is 0.4 percentage point higher than the same period in 2019.

Between the lines: The New York Fed also found that delinquency rates are rising fastest for borrowers who live in poorer areas.

• The lowest-income areas have perpetually higher delinquency rates, but more affluent areas also have delinquency rates at or above 2019 levels.

The bottom line: "The labor market and the general economy have remained resilient ... which makes pinning down the causes of rising delinquencies rates more difficult," New York Fed researchers write.

• "Whether this is a consequence of shifts in lending, overextension, or deeper economic distress associated with higher borrowing costs and price pressures is an important topic for further research."