December 2012 Canadian Economic Fundamentals

[Ally]

Canada's economic growth slows to a crawl in Q3 at 0.6%: StatsCan




OTTAWA ` Canada`s economy has hit stall speed with few areas of strong support, setting back any talk of interest rates hikes in the new year and likely restarting calls for more government stimulus.




The economy slumped to 0.6 per cent in the third quarter ` below even the gloomy 0.8 consensus and about one third what the Bank of Canada had predicted as recently as the summer ` as trouble loomed on the export side, housing and business investment.




In addition, Statistics Canada revised downward the second quarter one notch to 1.7 per cent and September, the last month, was flat, meaning the handoff to the current fourth quarter was weak.





Read the full article here.

 

[Ally]

Cooling house prices in parts of Canada not entirely negative for the economy: CIBC



CALGARY ` A cooling in house prices in some parts of Canada may not be all bad news for the country`s economy as cheaper real estate may free up retail spending power for prospective first-time home buyers, finds a new report from CIBC World Markets.




The report, released Thursday, said that while the evident slowing in Canadian home sales will take a bite out of domestic economic growth by reducing new housing starts and related sales of furniture and appliances, a gradual retreat in prices may be beneficial for parts of the economy and for some Canadians.





Read the full article here.

 

[Ally]

Variable rate still the cheaper mortgage option




The smart money`s long infatuation with the variable-rate mortgage has ended, perhaps a little hastily.




A lot of homeowners have saved a ton of money with variable-rate mortgages, where your borrowing cost floats with your lender`s prime lending rate. The prime rate is in turn guided by the Bank of Canada`s overnight rate, which was pounded lower in the financial crisis of 2007-09 and hasn`t rebounded. And yet, for reasons that may not be entirely sound, the popularity of the variable-rate mortgage is in decline.



Read the full article here.

 

[Ally]

David Rosenberg: Why I am bullish on Canada




Very recently, my Gluskin Sheff partners and I were invited to co-host an event at the Consul General`s residence in New York last week to raise awareness of Canada`s relative advantages for U.S. investors and entrepreneurs. It was a memorable evening.




I spoke for around 15 minutes. Before I began to pontificate, I could have sworn I heard someone say at the bar, `grab a drink, Rosenberg`s about to speak.` To which I responded `my talk is about Canada, you have no clue how bullish I`m going to be tonight.`





Read the full article here.

 

[Ally]

Winners, losers in Canada's cooling housing market




More evidence is piling up that house prices in Canada are cooling, but that might not be a bad thing for everyone.




Avery Shenfeld, chief economist at CIBC World Markets, said in a report issued on Thursday there are winners and losers when it comes to softer house prices.






The good news




A prospective first-time home buyer saving for that first down payment will not need to set aside as much if houses are cheaper to obtain.





Read the full article here.

 

[Ally]

Canada ranks among world's best places for corporate taxes




OTTAWA ` Canada has moved up three places to eighth in a global comparison of the most advantageous place to pay corporate taxes, placing the country in the top 10 for the first time.




The annual study by PwC, in conjunction with the World Bank and the International Finance Corporation, shows Canada moving sharply up in a 185-country comparison.




Canada placed 28th as recently as 2010, but continuing reductions of the corporate rate both federally and provincially, as well as reduced red tap, has dramatically improved its standing.





Read the full article here.

 

[Ally]

Winter vacation hot spots: Rent or buy?




While many Canadians choose to travel south for a vacation during the frigid winter months, many of us prefer to enjoy the snow-covered Canadian landscape with some good, old-fashioned winter fun.




From sliding down the slopes to skating on frozen lakes, and navigating tree-laden cross country trails, there`s no shortage of things to do ` that is, if you don`t mind the sub-zero temperatures.





Read the full article here.

 

[Ally]

Sellers in Vancouver, Toronto just say no as housing prices sink






Both cities, the focus of concern as Canada`s housing market slows, are feeling the heat, as the latest numbers show.




As The Globe and Mail`s Brent Jang reports today, sales fell almost 29 per cent in November from a year earlier, to 1,686, while prices declined by 1.7 per cent.




`Home sellers appear more inclined to remove their properties from the market today rather than lower prices to sell their properties,` said the realtor group`s president, Eugen Klein.




`On the other hand, buyers appear to be expecting prices to moderate.`




Indeed, new listings fell more than 14 per cent last month, and were almost 13 per cent below the 10-year average for the month of November.


`Read the full article here.

 

[Ally]

Loblaw soars on plans to create one of Canada's largest REITs




TORONTO ` Loblaw Cos. Inc. began to look a lot more attractive to beleaguered investors on Thursday when Canada`s biggest grocery chain made a move to create one of the country`s biggest real estate investment trusts.




Loblaw`s shares hit their highest level in more than two years after the company said it intends to create a real estate investment trust for the bulk of its vast property holdings: 35 million square feet with a current value of more than $7 billion. The stock closed at $38.20, up almost 14% with more than 17 million shares trading hands, far above its daily average.





Read the full article here.

 

[Ally]

Bank of Canada warns low interest rates risk to stability




OTTAWA ` The Bank of Canada warns that its own low interest policies and those of central banks around the world are adding another layer of risk to the already stressed global financial system and economy.




The Canadian central bank says near-record level interest rates in place since the 2008-09 recession are taking their toll on insurance companies, pension funds and even increasing the appetite of investors to take risks in search of higher returns.





Read the full article here.

 

[Ally]

Flaherty takes pride in mission accomplished




Finance Minister Jim Flaherty is not worried about a housing collapse, saying he is happy he has helped cool the market with the latest round of stricter mortgage rules.




The finance minister says he is also encouraged Canadians are paying down their mortgages and credit cards, and taking on less debt.





Read the full article here.

 

[Ally]

Pipeline official worries about impact of delays




EDMONTON - In a world hungry for energy, Canada can be a petroleum powerhouse with its bounty of oil and gas reserves.




But fights over export pipeline approvals could derail that potential while costing the economy billions and tarnishing Canada`s image in the global marketplace, Phillippe Reicher, vice-president of the Canadian Energy Pipeline Association (CEPA), said Thursday.





Read the full article here.

 

[Ally]

Canada, U.S. jobs rebound in November






Canada's economy added a whopping 59,300 jobs in November, flying past expectations and reassuring market experts after recent weak economic data.




The picture was also a encouraging in the U.S., where observers anxiously awaited for figures to assess superstorm Sandy's impact on the labor force. It appears no sign of major damage there, with data showing the economy added 146,000 jobs. The jobless rate fell to 7.7 per cent, a near four-year low.




"I would say the economy is still grinding ahead with decent growth. Nothing spectacular in either country, but it is still churning ahead," said Doug Porter, deputy chief economist at BMO Capital Markets.





Read the full article here.

 

[Ally]

Canada's unemployment rate down to 7.2%




Canada cranked out 59,000 new jobs in November as an increase in full-time work helped push the unemployment rate down 0.2 percentage points to 7.2 per cent, according to statistics released today.




Statistics Canada said Friday there were job gains in Ontario, Quebec, Alberta, Manitoba and Prince Edward Island.




There was little change in the other provinces.





Read the full article here.

 

[Ally]

One 'last hurrah' for galloping housing market




Economists are expecting that the blistering pace of new home construction in Canada will start simmering down shortly. But they've said that before.




Canada Mortgage and Housing Corp. will release the latest figures Monday, and on average economists are forecasting that the data will show an annualized pace of about 200,000 housing starts.





"This may be the last hurrah in terms of the monthly numbers," said Royal Bank of Canada economist Robert Hogue, who is expects Monday's figures to come in at an annualized pace of 206,000 starts. "Granted the permits have still come in fairly strong in the last month, but housing starts are probably near their peak now," he said. By early 2013 the pace should start cooling and that will last for at least a year or two, he suggested.





Read the full article here.

 

[Ally]

Buying a rental property? How the financing game has changed




Just four short years ago, you could buy an investment property with nothing down and get the best interest rates in the market.




That was then. Today, rental financing is night-and-day different. To mortgage a small (a one-to-four unit, non-owner occupied) rental property now, you need to plop down one-fifth of the purchase price. And even then, you don`t always get the lowest rate.





Read the full article here.

 

[Ally]

'The natural rate' being ignored in jobs talk



A predictable ritual takes place every first Friday of the month when Statistics Canada releases the unemployment numbers. Expect it later this morning when the numbers for November are published. Movements amounting to tenths of a percentage point in the unemployment rate will be parsed, diced, and explained. And the assurances will be the same: `We have recovered all the jobs lost during the recession and then some; firms can`t find workers with the right skills; job vacancies are going unfilled.`



Read the full article here.

 

[Ally]

Mixed signals for Canadian industrial real estate





Long the red-headed stepchild of the commercial real estate business, the industrial sector produced some compelling ` and conflicting - statistics and predictions ` for attendees of the Toronto Real Estate Forum last week.







It`s becoming known that Toronto stands as a major industrial hub, ranking as the third largest industrial market on the continent with 824 million square feet of space. (Montreal and Vancouver rank 12th and 13th respectively in North America).







Read the full article here.

 

[Ally]

November Housing starts






OTTAWA, ONTARIO`(Marketwire ` Dec. 10, 2012) - Housing starts in Canada were trending at 214,680 units in November, according to Canada Mortgage and Housing Corporation (CMHC). The trend is a six- month moving average of the monthly seasonally adjusted annual rates (SAAR)[sup]1 [/sup]of housing starts. The standalone monthly SAAR was 196,125 units in November, down from 203,487 in October.




`As expected, housing starts remained below their recent trend and continued to fall for a third straight month. This decrease was mainly attributable to declines in single-detached and multi-unit housing construction in Ontario and British Columbia, resulting in part from a decline in the pace of pre-sales relative to that in late 2010 and early 2011,` said Mathieu Laberge, Deputy Chief Economist at CMHC. `The drop in starts in Atlantic Canada was primarily due to a decrease in multi-unit housing construction in Halifax, following higher than normal activity in October,` added Laberge.





Read the full article here.

 

[Ally]

Housing construction cools, below forecast in November




Canadian housing starts appear to be embarking on the cooling that economists have been expecting, with November`s figures coming in slightly below forecasts.




The monthly seasonally adjusted annual rate of starts was 196,125 units, Canada Mortgage and Housing Corp. said Monday, down from 203,487 in October. Economists on average had been expecting the figure to be about 200,000.







Read the full article here.