Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canadian Mortgage Arrears Hit 12-Year High, Banks See 2020 Boom Wiped Out
The country’s largest banks are seeing more overleveraged borrowers fall behind. The arrears rate rose to 0.28% in April, doubling since September 2022 to a 9-year high for the rate. There were 13,752 mortgages in arrears in April, up 26% from last year and the highest count since 2014. A problem amplified by a decline in mortgages they hold, with the entire 2020 low-rate boom now rolled back.
Canadian Mortgage Borrowers Face “Less Bad News” As Renewals Peak: BMO
A Big Six bank sees inflation easing with de-escalating tensions in the Middle East. BMO notes the Government of Canada 5-year bond yield has dropped 30 basis points since mid-May. Is that good news for the 1.8 million mortgages renewing in 2026? More like “less bad news,” as the climb hadn’t yet been reflected in fixed-rate mortgages, explains the bank. In their opinion, variable rate mortgages remain the best option for more renewals.
Canada Is Attracting Less Elite Talent—And Losing Even More: StatCan
Canada’s reputation for attracting elite global talent has suffered a setback. Statistics Canada data shows only 1,550 new foreign postdoctoral fellows in 2024, less than half the amount in 2019. Fewer of these elite researchers are also staying and obtaining permanent residency. East Asian postdocs saw the sharpest drop, falling from 28% to 9% over the past 20 years. The combination can turn into economic headwinds, as these workers earn more and provide innovation leadership. Both factors are essential in fueling Canada’s economic success.
Toronto New Home Sales Nearly Triple, Still 4th Weakest May In 20 Years
Greater Toronto new home sales nearly tripled last May, rising 196.5% to 1,023 homes. If that sounds light for a region of nearly 7 million people, that’s because it is. Despite the surge, it remains the 4th weakest May in at least 20 years. Inventory is tightening as developers drop condo plans and pivot to single-family homes. However, there’s little concern over a shortage as current levels are still lofty.
Canadian Inflation Accelerates To 29-Month High, Broadens Beyond Gas
Canadian inflation is accelerating as energy price relief completely reverses course. The Consumer Price Index (CPI) climbed to 3.2% in May, driven largely by a 33.2% surge in gas prices. This isn’t only a gas problem though—half of the eight major CPI components accelerated. Inflation isn’t just rising, it’s seeing broad acceleration. A central bank’s worst nightmare.
