Umar Faruqui - Latest

• How Important Are Liquidity Constraints for Canadian Households? Evidence from Micro-Data

  Staff Discussion Paper 2012-9 Umar Faruqui, Samah Torchani

  Using a unique micro-dataset containing real and financial information on Canadian households for 2000–07, the authors address two questions: (1) What is the proportion of households whose consumption displays excess sensitivity to income, and who are likely liquidity constrained?

  Content Type(s): Staff research, Staff discussion papers Topic(s): Economic models, Sectoral balance sheet JEL Code(s): C, C3, C35, D, D1, D12, D3, D30
• June 14, 2012

  An Improved Framework for Assessing the Risks Arising from Elevated Household Debt

  Financial System Review - June 2012 Umar Faruqui, Xuezhi Liu, Tom Roberts

  Content Type(s): Publications, Financial System Review articles
• February 23, 2012

  What Explains Trends in Household Debt in Canada?

  Bank of Canada Review - Winter 2011-2012 Allan Crawford, Umar Faruqui

  Similar to the experiences in many other countries, household indebtedness in Canada has exhibited an upward trend over the past 30 years. Both mortgage and non-mortgage (consumer) credit have contributed to this development. In this article, the authors use microdata to highlight the main factors underlying the strong trend increase since the late 1990s. Favourable housing affordability, owing to factors such as income growth and low interest rates, has supported significant increases in home-ownership rates and mortgage debt. Much of the rise in consumer credit has been facilitated by higher housing values (used as collateral for loans) and financial innovation that makes it easier for households to access this credit.

  Content Type(s): Publications, Bank of Canada Review articles Topic(s): Credit and credit aggregates JEL Code(s): D, D1, D12, D14, E, E5, E51

• Assembling a Real-Financial Micro-Dataset for Canadian Households

  Staff Working Paper 2010-6 Umar Faruqui

  The lack of consolidated Canadian micro data on household balance sheets and expenditures has been an important impediment to empirical research into real-financial linkages in the Canadian household sector. Our paper attempts to fill this data gap by merging household balance sheet data from the Canadian Financial Monitor survey with household expenditure data from the Survey of Household Spending.

  Content Type(s): Staff research, Staff working papers Topic(s): Sectoral balance sheet JEL Code(s): C, C8, C81, D, D1, D10

• Indebtedness and the Household Financial Health: An Examination of the Canadian Debt Service Ratio Distribution

  Staff Working Paper 2008-46 Umar Faruqui

  The household debt-to-disposable income ratio in Canada increased from 110 per cent in 1999 to 127 per cent in 2007. This increase has raised questions about the ability of households to service their increased debt if faced with a negative economic or socio-economic shock.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial stability, Monetary and financial indicators JEL Code(s): D, D1, D11, D14, D3, D39
• September 15, 2008

  The Bank of Canada's Senior Loan Officer Survey

  Bank of Canada Review - Autumn 2008 Umar Faruqui, Paul Gilbert, Wendy Kei

  The Bank of Canada maintains regular contact with financial institutions as part of the information-gathering process that feeds into the larger set of information used to arrive at its monetary policy decision. Since 1999, the Bank has been conducting a quarterly survey of the business-lending practices of major Canadian financial institutions. Analysis of the information collected shows that it is correlated with future growth in both credit and business investment. This article focuses on how the survey is conducted and describes the construction of the summary statistics, highlighting the key statistical relationships in the historical survey data.

  Content Type(s): Publications, Bank of Canada Review articles Topic(s): Financial institutions, Monetary and financial indicators, Recent economic and financial developments

• Employment Effects Of Nominal-Wage Rigidity: An Examination Using Wage-Settlements Data

  Staff Working Paper 2000-14 Umar Faruqui

  The argument advocating a moderate level of inflation based on the downward nominal-wage rigidity (DNWR) hypothesis rests on three factors: its presence, extent, and negative impact in the labour market. This paper focuses on the employment effect of DNWR.

  Content Type(s): Staff research, Staff working papers Topic(s): Labour markets JEL Code(s): C, C2, C23, J, J2, J23, J3, J30