Stats Canada’s tweet summarizes the latest data from the second quarter. For every $1.00 in disposable income, Canadian households owe $1.65 in credit market debt. And debt is rising faster than growth in disposable income.
Here’s an excerpt from the report:
Leverage, as measured by household credit market debt to disposable income, rose from 163.0% in the first quarter to 164.6% in the second quarter. In other words, there was $1.65 in credit market debt for every dollar of disposable income. Disposable income (+0.8%) increased at a slower pace than household credit market debt (+1.8%).The household debt service ratio, measured as total obligated payments of principal and interest as a proportion of disposable income, was up slightly from the first quarter to reach 14.1% in the second quarter. This was higher than the historical average of 12.4% for the 1990 to 2015 period. In the prevailing low interest rate environment, the interest-only debt service ratio, defined as household mortgage and non-mortgage interest paid as a proportion of disposable income, continued at historic lows (6.3%).
You can read the full report here, and this story in the Vancouver Sun.