Excess household savings may help economy avoid harsher downturn: BMO

High household savings in Canada and the U.S. may help both countries avoid a severe downturn as high interest rates ripple through the economy.

Although pandemic savings have diminished significantly, many households still have above-average savings, says the report published Friday. 

Large savings were amassed by households during the pandemic as lockdowns restricted spending in areas such as entertainment and transit. 

Many workers also benefited from income support programs rolled out by governments, which cushioned incomes.