Posts from the ‘Monday Morning Interest Rate Updates’ Category
Monday Morning Interest Rate Update for May 22, 2018
In today’s’ post I simulate three different scenarios for Canadian variable rates over the next five years and provide a rationale for how each might unfold.
Monday Morning Interest Rate Update for May 14, 2018
It’s time for a fresh look at the question every borrower loves to ask: Is now a good time to choose a fixed or variable rate?
Monday Morning Interest Rate Update for May 7, 2018
There is no new post this week but I will be back up and running next Monday as usual. In the meantime, here are links to my five most popular posts thus far in 2018: Canadian Mortgage Rate Forecast for 2018 – Part 1 (Five-Year Fixed Rates) Canadian Mortgage Rate Forecast for 2018 – Part […]
Monday Morning Interest Rate Update for April 23, 2018
The Bank of Canada (BoC) left its overnight rate unchanged last week, as most market watchers expected. The Bank also released its latest quarterly Monetary Policy Report (MPR), which provides us with the Bank’s assessment of the current economic conditions at home and abroad and includes forecasts for key economic data. The overall tone of […]
Monday Morning Interest Rate Update for April 16, 2018
The Bank of Canada (BoC) meets this Wednesday, and while most market watchers aren’t expecting the Bank to raise its overnight rate at this meeting there is still the possibility that its accompanying commentary could push Government of Canada (GoC) bond yields higher, along with the fixed mortgage rates that are priced on them. The […]
What the Canadian Bond Market’s Surprising Reaction to Last Week’s Employment Data Means for Our Mortgage Rates
Monday Morning Interest Rate Update for April 9, 2018
Last Friday Statistics Canada released our latest employment report, for March. It estimated that our economy added 32,300 new jobs last month, which was well above the consensus estimate of 20,000. While the headline result came as a surprise, the much bigger surprise, at least to me, was the bond market’s reaction. Over the past […]
Monday Morning Interest Rate Update for April 2, 2018
Last week, Statistics Canada confirmed that our economic momentum slowed sharply in January as our GDP fell by 0.1% over the month. The drop was primarily attributed to sharp decreases in oil production and real-estate activity. While our January result came in below the consensus forecast of 0.1% increase, some loss in momentum was largely […]
Why I Don’t Think The Bank of Canada Will Over-React to the Latest Inflation Data (As the Bond Market Did)
Monday Morning Interest Rate Update for March 26, 2018
Last week Statistics Canada confirmed that year-over-year overall inflation spiked from 1.7% in January to 2.2% in February. At the same time, two of the three gauges that the Bank of Canada (BoC) uses to measure core inflation also breached the Bank’s 2% target threshold last month. Bond-market investors reacted quickly to the higher-than-expected inflation […]
Monday Morning Interest Rate Update for March 12, 2018
The only real question leading up to this meeting centred on the tone of the Bank’s accompanying statement. Would the BoC convey a hawkish bias out of concern for rising inflationary pressures and tightening labour market conditions, or would it sound more cautious in deference to increased trade uncertainty and the lagging effects of the three rate hikes it had recently made?
Monday Morning Interest Rate Update for March 5, 2018
Last Thursday, seemingly out of the blue, President Trump announced that the U.S. would impose a 25% tariff on imported steel and a 10% tariff on imported aluminum, adding that these new taxes may be applied as early as this week. The U.S. President has a surprising amount of latitude on trade policy. In this […]
Monday Morning Interest Rate Update for February 26, 2018
The consensus read of the latest inflation data, which showed only a modest uptick of one of the Bank of Canada’s key sub-measures of inflation (more on that in the post), was that this slight change is not likely to alter the Bank’s plan to raise its overnight rate at some point this summer. I continue to disagree with this view and believe that the Bank will once again prove more cautious than our mainstream economists are forecasting.
Why the Bank of Canada Will Be Cautious in 2018 (And It Isn’t Just Because of the January Employment Data)
Monday Morning Interest Rate Update for February 12, 2018
After thirteen straight months of impressive gains, Canada’s labour market hit the brakes hard last month. Our economy lost 88,000 jobs in January and that marked our biggest one-month drop in nine years. Investors reacted quickly, driving Government of Canada (GoC) bond yields lower on Friday and decreasing the odds of a Bank of Canada […]
Monday Morning Interest Rate Update for February 5, 2018
Last Friday U.S. bond yields surged higher in reaction to stronger-than-expected U.S. employment data. Will that push up Canadian fixed mortgage rates?
Monday Morning Interest Rate Update for January 29, 2018
Today’s post highlights an under-the-radar development that has the potential to have a significant impact on Canadian mortgage rates in 2018.