Statistics Canada reports that nationwide household debt reached unprecedented levels in the second quarter of 2016, surpassing the country’s gross domestic product for the first time. The main reason was greater borrowing due to historically low interest rates, according to the agency, RT reported. The report shows Canada’s household credit market debt, which includes mortgage loans and consumer credit, jumped by almost 2% to 167.8% compared with the first quarter of the year. In total, Canadians now owe about $1.68 for every dollar of disposable income. Total household credit debt reached $1.97 trillion, with $1.29 trillion in mortgages and $585.8 billion in credit cards, car loans and other personal loans. “As interest rates have remained at historic lows, the amount of mortgage principal paid by households has increased, steadily approaching the total amount of mortgage interest paid,” the agency said. Canada has seen the biggest increase in household debt relative to income of any major developed country since 2000. It has borrowed more as a country than it has produced.
