This trend represents an annual rate of approximately $75 billion or 0.2%-0.3% of GDP, a substantial increase from the $10 billion noted during the moratorium period. If consumer spending were to decrease directly in line with these repayments, it could potentially affect real GDP growth by 1% within a quarter.
Despite this potential impact, economists predict a less significant economic drag due to the current positive state of household balance sheets. This observation suggests that families may be better equipped to handle the increased financial burden than initially expected, thus mitigating some of the potential negative effects on the wider economy.
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Source: Economy - investing.com
