Bank of Canada worries a rate cut now could overheat the spring housing market

  • 📰 CBCTBay
  • ⏱ Reading Time:
  • 53 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 25%
  • Publisher: 63%

México Noticias Noticias

México Últimas Noticias,México Titulares

Bank of Canada Governor Tiff Macklem holds a press conference at the Bank of Canada in Ottawa on Wednesday, March 6, 2024. THE CANADIAN PRESS/Sean Kilpatrick

The Bank of Canada left interest rates unchanged this week, at least in part because it doesn't want to add fuel to a real estate market that's already heating up.Bank of Canada governor Tiff Macklem says interest rates will stay put for now because lowering them could undo the progress that has been made in reining in inflation. The Bank of Canada is trying to thread a needle.

"Sales are up, market conditions have tightened quite a bit, and there has been anecdotal evidence of renewed competition among buyers," said Shaun Cathcart, senior economist with the Canadian Real Estate Association. "Could that rebound be stronger than we've expected? Yes, it could," he said. "And that is an upside risk."The question is what may happen if the Bank of Canada cuts rates now, just as the housing market is heading into the spring — which usually sees a surge in activity.

Now, though, inflation is almost all the way back down to the bank's target of two per cent. The year-over-year rate eased to 2.9 per cent in January.Tiff Macklem, governor of the Bank of Canada, says core inflation — which strips out volatile parts of the consumer price index — gives the bank a sense of where the trend is.

"I do think they're going to be kind of reluctant to be cutting around the spring housing-buying season," said Veronica Clark, an economist at Citi in New York.

 

Gracias por tu comentario. Tu comentario será publicado después de ser revisado.
Hemos resumido esta noticia para que puedas leerla rápidamente. Si estás interesado en la noticia, puedes leer el texto completo aquí. Leer más:

 /  🏆 42. in MX

México Últimas Noticias, México Titulares

Similar News:También puedes leer noticias similares a ésta que hemos recopilado de otras fuentes de noticias.

Bank of Canada's interest rate decision shouldn't depend on housing market, economists argueAs Canada's inflation rate fluctuates, economists suggest that the Bank of Canada should not base its interest rate decision on the housing market. The January consumer price index report is expected to show a decrease in the inflation rate. Lower energy and food prices are believed to be the main factors behind the slowdown.
Fuente: TerraceStandard - 🏆 24. / 68 Leer más »