Ana Pereira, Toronto Star »

The Bank of Canada says the Canadian economy would have been in a solid spot right now if it wasn’t for Trump’s trade war, and it is worried that high levels of uncertainty could soon create a “dysfunctional” financial market.

The bank’s 2025 Financial Stability Report, released Thursday, said Canadians with a mortgage have managed their debt better than expected throughout 2024 while interest rates significantly dropped since June.

Meanwhile, insolvency filings by businesses have also fallen substantially, according to the report.
Those without a mortgage, however, are showing bigger signs of financial stress — though rates of arrears on consumer credit products remain below historical averages, the report stated.

The bank said that, overall, Canada’s financial institutions have not come under stress.