Statistics Canada says household debt ratio up in second quarter

OTTAWA – Statistics Canada says the amount Canadians owe relative to their income moved higher in the second quarter as the level of debt grew faster than their earnings.

The agency says household credit market debt as a proportion of household disposable income rose to 181.7 per cent on a seasonally adjusted basis in the second quarter, up from 179.7 per cent in the first quarter.

In other words, there was about $1.82 in credit market debt for every dollar of household disposable income in the second quarter.

The increase came as households’ disposable income increased 1.0 per cent, but household credit market debt rose 2.1 per cent.

Statistics Canada says, on a seasonally adjusted basis, households added $56.3 billion of debt in the second quarter including $48.7 billion in mortgages.

The household debt service ratio, measured as total obligated payments of principal and interest on credit market debt as a proportion of household disposable income, was 13.63 per cent in the second quarter compared with 13.34 per cent in the first quarter.

This report by The Canadian Press was first published Sept. 12, 2022.