Breaking news this morning as the Bank of Canada announced there will be no interest rate hike today – and a legion of homeowners, prospective buyers, and homebuilders all exhaled. They kept it at 5%, but hinted that it may go up again in November.
A Monex Canada analyst says the national economy – measured by GDP – shrank by 0.2% last quarter. “We had anticipated to see signs of a slowdown in Canada, but these figures were shockingly weak,” the analyst wrote. A Desjardins economist was even bolder, saying the GDP slip means no more interest rate hikes – and maybe even a rate cut next year. I don’t know about that… https://tinyurl.com/2xf797w4
Meanwhile, Re/Max Canada says the housing market will continue to soften this fall, as Millennials and Gen Z buyers are interest rate’d out of getting into the market. https://tinyurl.com/2b63349r
Also on housing, federal Conservative leader and the frontrunner to be the next Prime Minister, Pierre Poilievre, is pushing his plan to supercharge homebuilding across the country:
- Idea 1: hammer municipal halls who are slow to permit, or outright hostile, to new housing by withholding federal dollars.
- Idea 2: pre-zone and pre-permit high density housing anywhere rapid transit is built with a federal dollar. If cities go all-in on housing, up the federal grants to them.
- Idea 3: sell off thousands of federally-owned buildings and land to be used for housing. No wonder he’s surging in the polls. https://tinyurl.com/3kmkm3mp
In good news in the energy sector, Britain’s BP has agreed to buy virtually every drop of Liqueified Natural Gas that Squamish’s Woodfibre LNG plant can produce. Construction is already beginning on a key pipeline to support the LNG plant, which has been in the proposal/design stages for years. https://tinyurl.com/mtpxdbmb