The Canadian household savings rate in 1990 was higher than Australia’s household savings rate. However as a result of the global financial crisis and high interest rates the Australian savings rate jumped from negative 2% to 12% before stabilizing at around 10%. The Canadian savings rate has continued to follow the downward trend since 1990 though it has also stabilized as shown in the graph below:
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The following chart shows the comparison of debt to disposable income between the two countries:
Unlike Canada, the Australian debt to disposable income is declining since the financial crisis. Rising wage growth combined with higher savings rate puts Australian households in better shape than Canadian households.
Source: How Safe Are The New Safe Havens, by Nathaniel Hyde, CFA, Global Bond Strategies, Standish Mellon Asset Management Company LLC