A score of 3, Fitch says, means private sector credit is abnormally high as a share of GDP, and that property prices and/or exchange rates are also well above trend. Fitch pointed out that credit growth had been rapid in 2006. Australia and Canada's currencies have also strengthened on the back of rising commodity prices.
The agency also measures the robustness of the banking system on a scale of A to E. Australia is classed A and Canada B, implying that both have strong banking systems. Iceland and South Africa are also classed as B and have risk ratings of 3.
By this measure, the most endangered economies - with high risk scores and weak banking systems - are Russia (D3), Azerbaijan (E3) and Iran (E3). All developed economies are either A or B with the exception of Japan (C).
Iceland suffered from a sudden correction in February last year, after Fitch raised its risk rating to 3 and downgraded its long-term default rating to "negative outlook"; growth has slowed and both inflation and interest rates have risen.