Consumer and business insolvencies rising under weight of higher interest rates

The Office of the Superintendent of Bankruptcy says each shopper and business insolvencies rose considerably within the second quarter amid heightened rates of interest.

The company says the 31,224 shopper insolvencies within the April to June interval had been up 23.5 per cent in contrast with the identical interval final yr, whereas business insolvencies rose 36.9 per cent to 1,090.

The company says that for June, whole insolvencies had been up 19.6 per cent in contrast with June 2022, however down 2.8 per cent from May.

Total insolvencies for the 12-month interval ending June 30 had been 116,653, up 23.2 per cent from the earlier interval.

The Canadian Association of Insolvency and Restructuring Professionals says rate of interest hikes are rising stress on companies as they face increased prices and weakening shopper demand.

The affiliation says shopper insolvencies are rising steadily and reaching ranges akin to pre-pandemic, and it expects they are going to surpass pre-pandemic averages later this yr.

This report by The Canadian Press was first revealed August 3, 2023.