The central bank indicates in its latest report on financial stability than at the end of 2024, households had on average fewer debts compared to their income, while the requests for insolvency of companies had decreased considerably.
While the pressure on debt increases for households without mortgage, increased fears of financial shock to renewal for households with a mortgage loan decreased following a series of interest rate drops.
The Bank of Canada says, however, that the trade war with the United States threatens these gains and that, if it extends, it could slow down economic growth and make unemployment increase.
In the event of a serious and prolonged World Co-World War, the bank believes that households could accuse delays in payment of their mortgage loans at levels higher than those of the global financial crisis of 2008-2009. The bank claims that in the short term, the trade war could cause increased volatility of the markets, while workers exposed to trade could undergo dismissals and financial difficulties.
