Consumer debt levels in Canada continue to grow, creating a concern for the Bank of Canada.
It’s a tightrope to encourage Canadians to spend to stimulate the economy and help improve the general economy in Canada and act prudently in order not to run up household debt to problem levels.
As Canadian households have engaged in a borrowing spree, Federal Finance Minister Jim Flaherty has repeatedly taken steps to tighten mortgage lending. These steps are needed, Carney said, to ensure some Canadians do “not take the current situation and get themselves overextended and . . . into trouble.”
“Continuing high household debt levels in Canada could lead to a sharper-than-expected deceleration in household spending.”
The Star out of Canada has a more extensive article on this issue. Read it here.