http://www.bloomberg.com/apps/news?pid=20601082&sid=alegit0JtugA 6.1% GDP growth Q1 2010 Consumer spending rose 1.1 percent Investment in housing rose 5.4 percent Private companies led a 108,700 gain in jobs in April, the largest in records dating from 1976, and the unemployment rate fell to 8.1 percent from 8.2 percent. Manufacturing rose at a 4.2 percent pace in the first quarter and construction increased 2.5 percent "Private demand is really taking up the gauntlet to a large extent and driving this recovery forward,â said Meny Grauman, senior economist at Canadian Imperial Bank of Commerce in Toronto.
Funny, this might actually be a bearish report, the investment in housing so high means so much supply is going to come, this might break their housing market. And also it could induce the BoC to make a mistake tomorrow and hike rates
I must say I am surprised, with Canada doing so much trade with the US. A friend that lives in Whistler said property values were down 20% off high, which seems reasonable now that the Olympics are gone.
Housing values are still rising at a faster rate than investment in new housing. Housing values YOY are growing at 12%. I think there is still room for more housing supply as supply has not yet kept up with demand. If anything, more investment will stop prices from overheating. http://www.crea.ca/public/news_stats/statistics.htm Regarding a rate hike tomorrow, it is only expected to be a 0.25% hike to 0.5%, which is still very low and would be welcome in my opinion. Inflation is increasing and was higher than expected last month. Not to mention the higher demand for investment in Canada this will generate both in terms of CAD demand and due to the confidence boost in the Canadian economy investors will get with a slight hike.
New trade deals with China, India, and the EU are assuring that in the future the Canadian economy will be less dependent on the USA. Still the most important relationship and always will be, but at least not AS dependent. Canada and the EU are ahead of schedule on a new trade deal that is expected to bring billions of dollars to the Canadian economy.
thats it, I'm jumpping the border to Canada, no papers with me. I hope the cannuks will tolerate a human wave of pasty white anglos from south of the border just looking for a better life!
I am investigating the purchase of calls on BAX futures. Mar11 99.00 is trading at .01 according to the Montreal Exchange webiste. I have no idea what the bid/ask is or if it actaully even trades, but I will be checking it out. I wouldn't mind seeing the Bank of Canada hike a few times first.
BOC is going to call Ben's bluff they will hike very soon, maybe tomorrow. They have to, to cool off the economy.