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Why the Next Recession Will Hit Canadians Harder Than Americans

  • Northern households are more stretched, debt ratios indicate
  • Still, one metric shows credit vulnerabilities may be easing
DMI Industries Wind Turbine Manufacturing Plant

Photographer: Norm Betts/Bloomberg

The recent yield curve inversion has renewed speculation about a potential North American recession and prompted questions about how a contraction would affect households.

Though it’s impossible to say for certain when, or even if, such an event will occur, several indicators suggest the pain would be more severe on the Canadian side of the border than in the U.S.