**Credit Delinquencies Rise in US Department Stores amid Strained Spending**.
* US department stores have witnessed a notable surge in credit delinquencies, as consumers grapple with mounting financial pressures and a strained spending environment..
* The delinquency rate for revolving credit at department stores increased to 4.5% in the third quarter of 2023, up from 3.9% in the previous quarter and 3.6% a year earlier, according to data from the Federal Reserve..
* Non-revolving credit delinquencies, which include store credit cards, also climbed to 6.3% in Q3 2023, the highest level since Q1 2021 and significantly higher than the 4.9% recorded in Q3 2022..
* The rise in delinquencies reflects the weakening financial position of consumers, who are facing elevated inflation, rising interest rates, and diminishing savings..
* As a result, consumers are increasingly relying on credit to make purchases, but struggling to keep up with their payments..
* Department stores, already grappling with declining foot traffic and reduced sales, are now facing an additional challenge as credit-related losses mount..
* The increase in delinquencies is expected to continue as economic headwinds persist and consumers remain under financial pressure..
* To mitigate the impact, department stores may need to consider tightening their credit standards, offering financial assistance programs, and exploring alternative revenue streams..
* The trend highlights the challenges faced by retailers in the current economic climate, where consumers are cutting back on discretionary spending and prioritizing essential items..
* It also underscores the importance of prudent credit management for both consumers and retailers to avoid further deterioration in the credit landscape..
