OTTAWA — Statistics Canada says the amount Canadians owe relative to their income fell in the second quarter as household disposable income rose while the amount of debt was relatively unchanged.
The agency says household credit market debt as a proportion of household disposable income in the quarter fell to 158.2 per cent on a seasonally adjusted basis compared with a reading of 175.4 per cent in the first three months of the year.
In other words, Statistics Canada says there was $1.58 in credit market debt, which includes consumer credit, and mortgage and non-mortgage loans, for every dollar of household disposable income.
Even so, the agency noted that annual trends show that lower income households tend to have a higher debt to disposable income ratio.
The household debt service ratio, measured as the total obligated payments of principal and interest on credit market debt as a proportion of disposable income, dropped to 12.4 per cent from 14.5 per cent as payment deferrals related to the COVID-19 pandemic reduced the obligated principal paid in the second quarter.
Overall, credit market debt totalled $2.33 trillion at the end of the quarter including $1.55 trillion in mortgage debt and $779.4 billion in consumer credit and non-mortgage loans.
This report by The Canadian Press was first published Sept. 11, 2020.
The Canadian Press