Canada’s household debt-to-income ratio fell from a record high in the fourth quarter of 2013 while net worth rose, adding to the Bank of Canada’s belief that the housing market is in for a soft landing, reports the St. Albert Leader.

The Conservative government, along with the country’s central bank fear that lower interest rates might encourage people to take on too much debt, especially larger mortgages that could significantly increase the possibility of the housing bubble bursting in the future.

According to data from Statistics Canada, the ratio of household debt to income fell to 164 per cent in the fourth quarter of 2013, down slightly from a record 164.2 per cent in the third quarter.

“Today’s results should be mildly encouraging for policymakers, and suggest that the Bank of Canada’s view that imbalances are evolving ‘constructively’ is reasonable,” BMO Capital Markets chief economist Doug Porter said in an interview.

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