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“Excess” savings unlikely to avert spending slowdown

  • The recent US experience seems to suggest that the household saving rate could fall further as Canadians draw down the savings they built up during the pandemic, supporting consumption. A closer look suggests that the saving rate overstates the health of household finances, however. In any case, as Canadians face a larger interest rate shock than their US peers, it still seems likely that consumption growth will slow.

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