Canada’s finacial system faces three important vulnerabilties: high household indebtedness; imbalances in the housing market; and increased investor risk said Stephen Poloz, the Governor of the Bank of Canada, in his biannual report on Wednesday (December 10).
At a press morning press conference he pointed out the goal of his Financial System Review was “not to predict the most likely outcomes for the financial system. Instead, we use it to highlight key financial vulnerabilities and the catalysts that could turn those vulnerabilities into a risk to the financial system.”
The Governor suggested that ” there is some risk that the housing market is overvalued, and our estimates fall in the 10 to 30 per cent range”.
RCI’s Wojtek Gwiazda has a report.
ListenMore information:
Bank of Canada – Financial System Review, December 2014 (pdf) – here
Bank of Canada Governor statement – here
Wall Street Journal – Canada’s Central Bank Says Housing Prices, Debt Pose Threat to Stability – here
Globe and Mail – Canada’s housing market overvalued by as much as 30%: BoC – here
For reasons beyond our control, and for an undetermined period of time, our comment section is now closed. However, our social networks remain open to your contributions.