Bank of Canada cautions Canadian households on loans

Although Canada’s banking sector is still relatively safe, Bank of Canada policymakers say risks to the economy and financial system have increased over the past six months. The central bank said the European debt crisis, unbalanced recovery of the global economy and debt-ridden consumers are to blame for the increase. Bank of Canada officials worry that if interest rates rise or there’s another fall in the jobs market, Canadian households won’t be able to control their debt. Governor Mark Carney and his rate-setting panel warned borrowers and banks to be careful about taking on or giving out loans.

The Globe and Mail