06:38 AM EST, 02/20/2025 (MT Newswires) -- Canadian households are starting to wade back into the credit waters, said Bank of Montreal (BMO).

Credit growth picked up to 4.1% year over year in December, the fastest since May 2023 and almost a percentage point above the cycle low, noted the bank.

Both mortgage and non-mortgage lending have improved, with the latter bouncing 0.7% seasonally adjusted in the month, the most in nearly 12 years, pointed out BMO.

Credit card use surged in December, helped by a late Black Friday and partial sales-tax holiday, which also pumped retail sales 1.6%, according to Statistics Canada's advance estimate.

Fundamentally, though, the main reason borrowing is on the mend is that costs are on the decline and a recent burst of hiring hasn't hurt, either, added the bank.