RBA spins Australia’s record household debt load

RBA assistant governor, Michele Bullock, has played down concerns of Australia’s record household debt, claiming that the top 40% of income distribution account for three quarters of the debt load:

“Three quarters of debt is owned by households that sit in the top 40 per cent of income distribution,” she told a conference in Melbourne. “That’s actually a positive thing. It suggests that maybe (high levels of debt are) OK because people on higher income may have the capacity to meet their payments and they’re less likely to become unemployed.

“The median debt-to-income ratio is similar. It’s risen across all income quintiles but the higher debt ratio sits with households that have higher income. So that’s a positive thing”…

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