(Adds details from report)
OTTAWA Dec 14 Canadian household debt as a
share of income hit another record in the third quarter as the
pace of borrowing outstripped wage gains, Statistics Canada
showed on Wednesday.
The ratio of debt to disposable income rose to 166.9 percent
from an adjusted 166.4 percent in the second quarter. That meant
Canadians owed C$1.67 for every dollar of disposable income they
The Bank of Canada has flagged the high level of debt as a
potential vulnerability for the financial system and is expected
to update its view in a report on Thursday.
Years of low interest rates since the financial crisis, as
well as rising home prices, have encouraged Canadians to take on
more and more debt.
Household credit market debt, which includes consumer
credit, mortgages and non-mortgage loans, rose 1.3 percent to
C$2.005 billion from C$1.98 billion in the second quarter.
Mortgages made up the bulk of the total, standing at C$1.31
billion, while consumer credit was C$590 billion.
Disposable income increased by just 1 percent.
Economists expect tighter mortgage rules announced by the
government in October to help rein in excessive borrowing. There
have also been signs that families are saving at least part of
the child benefit checks that the government began mailing in
($1 = $1.3101 Canadian)
(Reporting by Leah Schnurr; Editing by Lisa Von Ahn)