As more Canadians shop for vehicles, an increase in auto loans has been a big driver of debt growth. Balances on consumer loans including credit cards and lines of credit – grew by 2.6 per cent year-over-year, driven primarily by the continued popularity of lines of credit and auto loans. The report begged the question: can consumer spending continue to drive the economy given that debt loads are so high? Article Continued BelowBut total household credit grew by 5.1 per cent in the April to June period, following a quarter in which household net worth advanced at its slowest pace since 2009. “Should a shock materialize that leads to a housing market correction, the large run-up in household debt indicates a ‘more severe and longer-lasting’ decline in household consumption than would otherwise have been the case.”

Source: thestar August 24, 2016 17:48 UTC