Debt-to-GDP levels in developed markets have grown substantially in the years following the global financial crisis, rising from 229% to 265% of GDP according to HSBC, citing data from the Bank of International Settlements.
The table below, supplied by HSBC, reveals the breakdown of debt levels by household, corporate and government sectors, both for developed nations as a whole, and by individual countries.
Unsurprisingly, almost all of the growth was concentrated in government debt, rising from 69% to 110% of GDP between 2007 to 2014. In comparison, households debt levels fell by 7 percentage points (ppts) to 73% while corporate debt inched up by 1ppt to 81%.
While that was the trend for developed nations as a whole, that performance was not replicated by individual nations.
In Australia, government debt levels increased by 26ppts, rising to a still comparatively low level 35% of GDP. Corporate debt levels actually fell as a proportion of economic output, sliding 4ppts to 77%.
Household debt, alternatively, continued to rise rapidly, rising by 11ppts to 119% of GDP. The figure was second only to Switzerland at 120% of GDP.
Given the rapid uplift in Australian house prices, along with recent lending figures, it’s a safe bet a lot of that increase ended up in the property market.
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