Canada’s oldest bank is accelerating its forecast schedule for the central bank. BMO sees the first interest rate hike in April, after yesterday’s announcement from the Bank of Canada (BoC). That would be 3-months sooner than previously forecast, and the first hike is just the beginning. The forecast shows the overnight rate rising as much […]
One of the world’s largest economies is handcuffed to over-leveraged home buyers. An analysis from Oxford Economics looks at two rate hike scenarios in Canada. Tony Stillo, the firm’s chief economist, expects the Bank of Canada (BoC) to hike interest rates slowly. If the central bank takes this path, all households will bear the burden […]
Canadians are going all-in on housing, as it’s increasingly seen as a low-risk asset. As debt grows faster than the economy, the ratio of mortgage debt to gross domestic product (GDP) has been soaring. Canada has created so much moral hazard, home prices no longer fall during a recession. Instead, households are leveraging up and […]
The Canadian economy is recovering slower than its peers despite elevated inflation. BMO chief economist Douglas Porter indexed the GDP for Canada, the US, and Australia in Q3 2021. All three economies began as a v-shaped recovery, but Canada is the only one not to hit pre-pandemic levels. Despite signs of a strong economy, like […]
The Canadian economy is quickly going from a recovery to overstimulated. That was the take from the National Bank of Canada (NBC) today, anyway. In an unusual move, the Big Six bank wrote an open letter demanding a halt to stimulus. They also argue that the central bank needs to hike rates in the next […]
It doesn’t matter if your city just saw massive price gains; they might see another year of excessive growth, interest rates be damned. That’s essentially the take from Re/max, one of Canada’s largest estate brokerages. The firm is forecasting massive growth across the country next year, with markets rising up to 20% over the next […]
Canada is planning a lot of new construction activity, but it’s not housing they’re looking to build. Statistics Canada (Stat Can) data shows the building permit values soared in October. The increase in permits, a leading indicator of future building activity, was due to non-residential building. Residential building actually weighed down the aggregate, falling further […]
The US Federal Reserve just scrapped the transitory narrative, and it was felt in Canada. Reserve Chairman Powell candidly dismissed the transitory inflation explanation. This immediately began to flatten Canada’s yield curve, according to BMO. The bank’s chief economist, Douglas Porter, highlighted this point to clients in his latest research note. His analysis shows the […]
Canadian real estate prices are rising, but investors are quietly pulling back. In fact, they’re withdrawing their capital at one of the fastest rates in history. Statistics Canada (Stat Can) data shows residential investment dropped sharply in Q3 2021. This is the component of GDP that covers real estate’s most direct economic output. The GDP […]
The trend of US home buyers fleeing expensive coastal regions is still happening, according to the latest contract data. In October, the National Association of Realtors (NAR) Pending Home Sales Index (PHSI) showed a mixed movement. The national index is lower than last year but that’s not the case for half of the regions. Last […]
