Thursday, September 24, 2009
U.S. Credit Card Defaults on the Rise
Credit card defaults tend to rise after a period of high unemployment rates, but according to Moody's default rates have reached an all-time high. The Moody's credit card charge-off index rose from 10.52% to 11.49% from July to August. The credit card charge-off index measures the amount of credit card loans that banks do not expect will be repaid. Moody's expects that unemployment rates will continue to rise next year so it should be expected that credit card defaulting will continue to rise.