Ottawa: Statistics Canada reports that Canada’s household debt-to-income ratio fell in the second quarter as disposable income growth outpaced the growth of debt. According to seasonally adjusted figures, the ratio of household credit market debt to disposable income dropped from 178.6% in the first quarter to 176.4% in the second quarter. This means Canadian households owed an average of $1.76 in credit market debt for every single dollar of disposable income.
The household debt service ratio—which measures total principal and interest payments relative to disposable income—also declined, falling from 14.68% in the previous quarter to 14.52%.
Overall credit market borrowing, which includes consumer credit alongside mortgage and non-mortgage loans, slowed to $29.4 billion in Q2, down from $34.4 billion in Q1. Mortgage borrowing eased to $19.4 billion, marking its slowest pace of growth since the first quarter of 2024. Meanwhile, non-mortgage loans, including consumer credit, also moderated to $10.0 billion.
