One measure of how consumers are doing financially is how they are handling their debt.
On the heels of a report showing a rising credit card default rate in December, consumers appeared to slip behind on all their debt payments last month.
The monthly S&P/Experian Consumer Credit Default Indices, a report that monitors changes in consumer credit defaults, shows the overall default rate ticked up three basis points from the previous month to 0.92% in January.
But it's the bank card default rate that's the headline number. It rose 26 basis points from December to 3.21%. That suggests consumers were having a harder time making their credit card payments on time in the aftermath of the holidays.
Other debt defaults rise more slowly
At the same time, defaults on car loans rose slightly from the previous month to 1.06%. Defaults on first mortgages rose even less, to a default rate of 0.72%.
The five U.S. cities monitored each month all saw increases in debt defaults last month, with Miami experiencing the largest hike, up 14 basis points to 1.67%. That puts it at a 31-month high.
Dallas and Los Angeles both saw their composite rates rise eight basis points, but remain well under 1%. Chicago's default rate is just over 1%, and New York's is just under. Both cities saw slight increases last month.
What's behind the increase? Part of the answer may be that consumers are taking on more debt. As loan volumes rise, so does the likelihood that some borrowers will default. But David Blitzer, managing director and chairman of the index committee, says the credit card numbers bear watching.
"While consumer credit default rates on mortgages and auto loans remain low and stable, default rates on bank cards have popped up to the highest level seen since July 2013," Blitzer said.
Not too worried
But overall, Blitzer says the current consumer debt default levels are not flashing economic warnings. He notes that during the two years between 2004 and 2006, when the economy was fairly strong, bank card defaults were higher than they are today.
"Recent data point to consumer optimism: retail sales rose 5.5% in January 2017 compared to a year earlier, consumer sentiment measures rose over the last two years, and employment and labor market conditions are favorable," Blitzer said. "Federal Reserve data on consumer credit and mortgage debt outstanding reveal that consumers are borrowing money."
But are they borrowing too much? Back in September the personal finance website WalletHub published a study showing consumers added a record $34.4 billion in new credit card debt in the second quarter of last year, the largest build-up since the government began tracking the statistic in 1986.
At the time, the authors of the study wrote that it is not a question of whether consumers are weakening financially, but rather how long "this trend toward pre-recession habits will last and just how bad it will get.”