Governing Council judges that the overall level of risk to the Canadian financial system is about the same as it was six months ago, when we published our Financial System Review. New mortgage borrowing is more sound, and house price growth has decelerated. Nevertheless, the stock of household debt will stay high for years, and house prices remain elevated in certain markets.
We have experienced a series of different types of crises since 2008. Each of them has had devastating effects on the real economy. What have we learnt? The crises have made it very clear that a highly interconnected financial sector requires a stronger institutional framework than what we currently have.