Household worth rebounds after recession
Rising stocks and home prices have helped restore almost all of the
value Canadians lost in household net worth during the economic
downturn.
Household net worth rose 1.3%, or by $74-billion, to $6-trillion, as the
growth in the value of assets, particularly equities and residential
real estate, exceeded the increase in liabilities, Statistics Canada
reported Monday.
“This marks the fourth consecutive quarterly improvement in household
net worth and reflects a 96% recovery off the net worth lost during the
recent economic downturn,”
David Onyett-Jeffries, economist at RBC Economics Research, wrote in
an analysis.
“The increase of household net worth continues to repair the cumulative
$552-billion decline.”
Household debt has also risen as low interest rates have encouraged
Canadians to increase borrowings, but that has led to strengthening in
demand and asset prices, particularly housing, said Mr. Onyett-Jeffries.
The ratio of household credit-market debt to income rose to 147% from
144.9% in the fourth quarter, while other consumer loan growth slowed,
Statistics Canada said in its report.
Meanwhile, the federal agency also reported that national net worth —
national wealth minus net foreign liabilities — edged up 0.6%, or more
than $38-billion, to $6.2-trillion in the first quarter.
On a per capital basis, national net worth reached $181,500, up from
$180,900 in the previous quarter, Statistics Canada reported.
Total government debt rose, climbing 2.1% to $1.7-trillion as borrowings
by all levels of government increased as bond issuance rose, especially
by the federal government. Financial Post
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