During the last three months of 2021, credit card balances increased by $52 billion to $860 billion—the largest quarterly increase in the 22-year history of the data, according to the Federal Reserve Bank of New York’s quarterly report on household debt and credit.

Overall, total U.S. household debt increased by $333 billion during the fourth quarter to $15.58 trillion, according to the New York Fed. Throughout 2021, debt balances—including mortgage, credit card, auto, and student loans—grew by $1 trillion, largely driven by mortgage balances. 

“The total increase in nominal debt during 2021 was the largest we have seen since 2007,” Wilbert Van Der Klaauw, senior vice president at the New York Fed, said in a statement. “The aggregate balances of newly opened mortgage and auto loans sharply increased in 2021, corresponding to increases in home and car prices.” 

The latest data shows a return to “typical patterns” in credit card balances, where fourth quarter balances rise, Americans pay down the debt in the first quarter, and balances grow moderately in the second and third quarters, New York Fed researchers said Tuesday. 

The latest jump in credit card spending may be tied to inflation, as not all of the credit card balance is carried-over debt, according to New York Fed researchers. That means the credit card data is going to pick up price increases. If there’s a lot of inflation and people keep on buying goods—even at the same level—the total amount of spending will go up. So part of the increase may reflect the jump in overall prices. 

But while the rise in debt was larger than average, New York Fed researchers said Tuesday that American households are in “pretty good” shape. In fact, credit card balances remain $71 billion lower than pre-pandemic levels at the end of 2019. 

Despite the drop-off of many government programs, including stimulus checks and enhanced unemployment benefits, it seems rising incomes and demand for workers have allowed Americans to absorb this debt. 

Additionally, delinquencies remain low—only 3.2% of credit card debt was 90 days or more past due and categorized as “serious delinquency” at the end of 2021. That’s actually down nearly a percentage point from the same period in 2020. 

Moreover, Americans haven’t come close to hitting credit card borrowing limits. Available credit has actually risen steadily throughout the past year.

Yet New York Fed researchers said Tuesday they would not be surprised if by the end of 2022, American credit card debt surpasses the pre-pandemic levels. The researchers stressed that’s an estimate, noting the seasonality of credit card balances makes it a little bit more of a challenge to predict.