The credit card delinquency rate in the United States reached pre-pandemic levels in July.

GMTEight Source noted that according to data from Seeking Alpha, the credit card delinquency rate in the United States in July has climbed to pre-pandemic levels. The average delinquency rate for the eight banks tracked by the organization increased by 14 basis points, reaching 2.67%, surpassing the average level of 2.64% in July 2019. Credit quality indicators have remained at exceptionally low levels for about three years, as fiscal stimulus and debt relief programs supported consumers and boosted household balance sheets during the most severe phase of the pandemic. Wolfe Research analyst Bill Carcache pointed out that credit conditions are deteriorating, "but very slowly." The prospect of higher long-term interest rates should eventually weaken the labor market. However, he stated, "as long as employment remains strong, we expect the pace of deterioration in consumer credit to remain slow." John Hecht, an analyst at Jefferies, wrote in a monthly credit monitoring report that the batch of credit card reports for this month came as "no surprise..." and that "the credit card results for July were in line with normalization expectations." Delinquencies and net charge-offs are increasing, strong loan demand; he said payment rates are declining but still above pre-pandemic levels. The average delinquency rate and net charge-off rate have been distorted by data from Bread Financial (BFH.US), which now exceeds pre-pandemic levels. Excluding Bread Financial, the average delinquency rate is 1.98%, slightly higher than June's 1.95% and slightly lower than July's 2.28%. The average net charge-off rate, excluding Bread Financial, is 2.83%, a decrease from June's 2.85%, but still 41 basis points lower than July 2019's 3.24%. Among the credit card issuers covered by Carcache, he rated American Express (AXP.US), Bread Financial, and Discover Financial (DFS.US) as "in line with the market," and rated Capital One Financial (COF.US) and Synchrony Financial (SYF.US) as "underperforming the market." The group's loans increased by 1.4% to $472.47 billion on a month-on-month basis, and increased by 14.5% year-on-year. It is worth noting that according to data from the Federal Reserve Bank of New York, the card issuers tracked by Seeking Alpha account for about 46% of the $10.3 trillion credit card debt held by American consumers.