Household debt-to-income ratio edges lower as interest payments expand

Statistics Canada says the ratio of household debt to disposable income improved in the fourth quarter as gains in disposable income offset an uptick in credit market debt.

The federal agency says on a seasonally adjusted basis household credit market debt as a proportion of household disposable income edged down to 180.5 per cent in the fourth quarter, compared with 184.3 per cent in the third quarter.

The reading means there was $1.81 in credit market debt for every dollar of household disposable income. 

The improvement in the fourth quarter came as household disposable income increased three per cent while household credit market debt edged up 0.8 per cent.