Australia vs. Canada: Household Saving Ratio and Household Debt-to-Income Ratio

Households in Australia and Canada are carrying high-levels of debt in recent years. In both the countries mortgage is a major driver of household debt as prices of houses have skyrocketed. Overall the debt-to-income ratio for households has been rising in both the countries as shown in the chart below:

Click to enlarge

The household saving rate declined continousely since the 1980s until 2004. However they have reversed direction and has been on an upward trend in the past few years. The saving rate in Australia is much higher than in Canada

Source: Philip Lowe: Australia and Canada – shared experiences a speech by Mr Philip Lowe, Governor of the Reserve Bank of Australia, BIS

Hat Tip: Matthew C. Klein at Alphaville

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