06:37 AM EDT, 03/14/2025 (MT Newswires) -- Canadian households' balance sheets were relatively stable to cap off 2024, noted Bank of Montreal.

The debt service ratio fell in all four quarters and was sitting just above 14% in Q4, providing relief for household budgets through the year, said the bank.

In the meantime, the debt-to-income ratio ticked up for the first time in almost two years but is down almost 13 percentage points from its peak in 2021.

The outlook for the coming quarters is much less clear, stated BMO. If, as the bank expects, the trade war with the United States continues to weigh on economic growth, the labor market -- and income growth -- will take a "meaningful" hit.

Further expected easing by the Bank of Canada can cushion some of that impact, but it won't be enough to offset the downside risks for households, added BMO.