Yep, mortgage arrears are going higher

Wednesday, 1 February 2017

Moody’s is out today with its arrears data for November last year and we’re going higher. Auto loans bucked seasonal trends and rose:

We’re looking at post-GFC highs in Q1. Auto loans are non-revolving so are a good leading indicator for revolving loans given they’re a more pure measure of interest rate stress. Having said that, RMBS is showing all by itself that mortgage defaults are headed higher as they also lifted unseasonally:

Still looks like 2013-14 vintages are in the gun suggesting firmly that WA and mining districts are leading the charge.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.