Sign -Driving Miss Daisy

Signature/Redhead & Chef

Signature Ad

Skyscraper - The Vue


Click here to see more
Community Calendar
Click here for full listings.
Do campaign signs play a role in helping you decide who to vote for?

Total Votes: 189
View Results Past Polls
User Submitted Photo Gallery
Submit Your Own Photos
2012-06-14 at 11:26

BoC warns European crisis could impact Canada

By The Canadian Press
Need some Xtra Cash until next payday? We’ve got it here for you at Xtra Cash. 2 convenient locations on Dawson and Frederica. Click here for details

OTTAWA - The Bank of Canada continues to warn that the high level of household debt and overvalued real estate in this country have left the economy vulnerable if a financial shock erupts in Europe.

The country's central bank says Canadian households generally have too much of their net worth tied to real estate values, which it says are overvalued.

It notes segments of the housing market that have a persistent oversupply — such as condos in Toronto — face a higher risk of a price correction.

Using a hypothetical stress test, the bank says a three per cent increase in unemployment — about the same as occurred in the recent recession — would almost triple the proportion of indebted households that would go into arrears.

The current rate is currently about half a per cent and could rise to 1.3 per cent under that scenario.

The Bank of Canada is careful to point out it isn't predicting a global crisis like the one in 2008 but suggests such a failure could not be contained to Europe.

The findings are contained in the central bank's latest financial system review.

The Bank of Canada concludes that the risk of a European financial meltdown that ripples around the world have returned to the elevated levels of last December.



The Canadian Press
© The Canadian Press, 2014

Click here to report a typo or error

Banner/Vector Construction


We've improved our comment system.
Comments for this story are semi-moderated. Read our comment guideline.

Add a new comment.
You must log in to add comments.
Create a new account
Forgot password?
Log In