CIBC World Market says "we are at the early stages of a softening trend" in the rate of growth in overall household credit in Canada – although the investment firm notes there has been double-digit growth in both mortgage and non-mortgage credit.
The Canadian mortgage market is still up by an "impressive" 13.4 per cent compared with last year but adds "this pace of growth is unsustainable," it says.
"There are also early signs that the pace of growth in non-mortgage consumer credit is slowing. Overall consumer credit is now expanding by just over 10 per cent on a year-over-year basis. Look for this figure to trend lower in the coming six months."
The report adds that the cumulative number of consumer bankruptcies rose by 3.8 per cent during the year ending June 2008, with Ontario and Quebec leading the pack, and says a further increase is likely.
