Statistics Canada reported Thursday that it was the second quarterly decline in a row in the ratio of household debt to disposable income. It was at 162.76 in the third quarter of 2012 and fell to 162.62 per cent in the fourth quarter of last year.
"Following several years of rising indebtedness, excesses associated with household debt are finally starting to unwind in a gradual manner," TD economist Diana Petramal wrote in a commentary Thursday.
"The moderation in borrowing was largely driven by a slowdown in mortgage credit growth (up 5.4 per cent), which cooled to the weakest pace since 2001."
She noted that it was the third consecutive quarter in which overall Canadian household debt grew more slowly than assets.
Statistics Canada said Thursday that household net worth advanced 1.9 per cent in the first quarter, led by gains in the value of equity holdings and pension assets.
The agency noted that the main index on Canada's largest stock exchange rose 2.5 per cent in the first quarter. Since then, however, the S&P/TSX composite index has dropped well below where it began the year in January.
The index was at 12,500 at the beginning of the first quarter but rose to about 12,750 at the end of March. On Thursday afternoon, the index was down about 200 points to below 12,100.
Statistics Canada said the value of household real estate increased by 0.9 per cent in the first quarter, reflecting strength in real estate values. Industry data suggest residential real estate prices have continued to climb since then.
In the first quarter, Canada's overall national net worth rose to $7.1 trillion or $202,000 per person, an increase of 2.1 per cent from the fourth quarter of 2012. That compared with a 1.1 per cent rise in the previous quarter and was the biggest increase in national net worth since the first quarter of 2012.
"Higher asset prices, primarily real estate, led the advance, while national saving accounted for three per cent of the increase in national net worth," Statistics Canada said.