Canadian households fell a bit further behind on their credit card bills in the third quarter, according to new data from Fitch Ratings.
The rating agency reported on Monday that the three-month average for late-stage delinquencies — bills that are over 60 days past due — rose to 1.27% in the third quarter, up from 1.19% in the second quarter.
At the same time, Fitch’s monthly payment index dropped to 56.8% in the third quarter from 57.25% in the second quarter, on a quarterly average basis.
The deterioration in card performance came against the backdrop of “ongoing tariff uncertainty,” Fitch said, which “weighed on investments, employment and household spending.”
Despite the weakness in the monthly payment rate and the rise in delinquencies, Fitch also reported that its net charge-off index improved slightly in the third quarter, with the quarterly average edging down to 3.12% last quarter, from 3.3% in the second quarter.
Looking ahead, the rating agency said that it “expects further weakening in credit card delinquency and charge-off performance due to softening labour market conditions, high cost of living, and elevated household debt.”