07:03 AM EST, 12/13/2024 (MT Newswires) -- Canadian households Thursday saw an improvement in key debt metrics for Q3, said Bank of Montreal (BMO).

Growth in disposable incomes outpaced borrowing, which brought the seasonally adjusted debt-to-income ratio down for the sixth straight quarter, noted the bank.

Similarly, debt service costs have taken a sizeable step down in recent quarters, as a share of income, from the record high set in Q4 2023, pointed out BMO.

While mortgage resets will continue to add upside risk to this ratio in the near term, income gains and ongoing rate cuts are expected to relieve some pressure on household finances, it stated.

Ultimately, these improvements should support a steady recovery in consumer spending, which will, in turn, drive economic growth in 2025, according to the bank.