Subscribe with RSS ReaderWednesday, July 20, 2011 Bank of Canada hints that interest rate hikes are coming!Categories:Calgary Real Estate,Canadian Interest Rates,Keller Williams Calgary,Paul Dojcinovic,Variable versus Fixed
Bank of Canada hints that rate hikes are coming sooner rather than later
OTTAWA – The Bank of Canada signaled Tuesday that it will look for an opportunity to raise interest rates sooner rather than later to keep inflation in check as the Canadian economy continues to grow.
The central bank kept its overnight rate target at one per cent but noted that the U.S. economy has grown at a slower pace than expected and Europe faces a growing credit crisis — both potential drags on the domestic economy.
Despite those threats, the bank said it believes Canada’s economy remains on track to grow this year, which observers said likely means a rate hike as early as October .
CIBC World Markets chief economist Avery Shenfeld said the bank’s decision to drop the word “eventually” in reference to the timing of its next rate hike suggests it will move before the end of the year.
“The underlying message is that rate hikes will be coming sooner than eventually,” Shenfeld said. “The surprise is really for those who thought that the Bank of Canada would be waiting until 2012 to begin hiking rates, because I think here the message is directed at those dovish observers and indicating that we will probably be moving sooner than that.”
The suggestion that rates in Canada will rise in the near term helped push the loonie up 0.87 of a cent to 105.16 cents U.S.
Canadian economic growth slowed in the second quarter, but the central bank said it expects to see an acceleration in the second half of the year.
Overall, the Bank of Canada expects the economy will expand by 2.8 per cent in 2011, compared with its call in April for 2.9 per cent growth. The outlook for 2012 and 2013 was unchanged at 2.6 per cent and 2.1 per cent respectively.
Shenfeld said the central bank will likely wait to see if its economic outlook is on track before moving to raise rates.
“The key is the Bank of Canada has to see evidence that its projection for a re-accelleration in economic growth is actually taking place,” said Shenfeld, who currently expects the central bank to hold rates in September and move in October.
BMO Capital Markets senior economist Michael Gregory said the case of a rate hike was building, noting that household spending in Canada remains solid.
“We are sticking to our call for October and December rate hikes this year,” Gregory wrote in a note to clients.
However TD Bank economist Sonya Gulati said she continued to expect the Bank of Canada to keep rates on hold until its first meeting in 2012.
“We think that they are going to time it more to when the (U.S.) Fed is going to start to increase it, which we think is going to be March of next year,” she said.
“In previous communications, the governor has indicated that the rate spreads between the two countries is something he’s keeping a close eye on and that there has to be a working gap between the two for the countries to go forward, given how high the Canadian dollar is.”
Gulati said TD expects the Bank of Canada will increase its overnight rate target in one-quarter percentage point intervals starting in January to two per cent before pausing to assess the situation and then increasing the key rate again to three per cent by the end of 2012.
A full update on the central bank’s outlook for the economy and inflation is expected when the Bank of Canada publishes its monetary policy report on Wednesday.
The central bank said in its statement Tuesday that the U.S. economy continues to be restrained by the consolidation of household balance sheets and slow growth in employment while fiscal austerity measures in Europe also restrain growth.
“Widespread concerns over sovereign debt have increased risk aversion and volatility in financial markets,” the central bank said in its statement.
The central bank also said its outlook assumes that European authorities will be able to contain the sovereign debt crisis, “although there are clear risks around this outcome.”
However as Europe and the United States continue to put up warning signs, the Canadian economy has appeared to be on track with three consecutive months of job growth and signs of inflation. Statistics Canada said Tuesday that its composite leading index rose 0.2 per cent in June compared with a 0.8 per cent gain made in May.
The agency said a downturn in the auto sector due to disruptions following the earthquake and tsunami in Japan temporarily slowed assembly work in Canada, while the housing index increased 0.3 per cent as home starts in June hit a high for the year to date.
The Bank of Canada’s latest business outlook survey last week found corporate Canada in a generally upbeat mood and looking to hire with 57 per cent of the firms surveyed expected to hire new workers over the next year compared with just four per cent of firms that expected to have fewer employees over the next 12 months.
Statistics Canada also reported a net gain of 28,000 jobs for June, a stark contrast to a disappointing report of only 18,000 jobs added in the United States.
The bank’s overnight target rate affects the prime lending rate at Canada’s big banks and in turn the rates for variable rate mortgages and lines of credit.
The Bank of Canada’s next scheduled rate announcement is set for Sept. 7.
The Canadian Press http://www.therecord.com/news/business/article/565419--bank-of-canada-hints-that-rate-hikes-are-coming-sooner-rather-than-later Tuesday, January 5, 2010 City Assessments are out, Calgary Herald posts Article about 13% Price decrease...Your thoughts?Categories:Calgary Real Estate,Calgary Real Estate Market,Calgary Real Estate Update,Calgary Realtor City Assessors overshot the ball in 2006 and more so in 2007 and now they are just correcting their previous years' over assessment.
The main difference between how the city assesses properties and how realtor's do is the time period in which an assessment of your home is done. For instance when Realtors do a market evaluation of your home to determine current market value they use the most recent market stats and information from current Sold and Active listings. City assessments are done annually which means your assessment stays the same the entire year, while the market constantly changes. In order to determine current market value to find out what your home is really worth
Over the past 2 years, many people have been left wondering why their home has not been selling even though the city assessment of their home was for $450,000 and they surprisingly can not even get $400,000 for their home.
Mind you the spread between the current market value that people are getting for their homes and their assessed values is shrinking . While the city is re-analyzing their annual "snapshot" property assessments and giving people a more in-tune assessment which in fact is a gradual correction from their higher year over year estimates of the past few years.
Post your comments and let us know what you think about this article and the assessed value of your home.
Friday, November 13, 2009 Multiple offers are back!Categories:Calgary homes for sale,Calgary market update,Calgary real estate,Keller Williams Realty South,November 2009,Paul Dojcinovic Calgary Real Estate Market Statistics
|
| TOTAL MLS® Homes and Condos | October 2009 | October 2008 |
| Inventory |
7,995 |
12,316 |
| New Listings |
3,567 |
4,546 |
| Sales |
2,346 |
1,529 |
| Average Sale $ |
409,823 |
405,590 |
| Sales $/List $ |
96.61% |
95.58% |
Multiple offers are back...
As Calgary's real estate market continues to see prices rebound!
-------------------------------------------------------
KELLER WILLIAMS REALTY SOUTH
600, 11012 MACLEOD TRAIL S. CALGARY, AB T2J 6A5
C: 403-608-2191 | O: 403-278-6884 | F: 403-592-6831
Are the signs pointing to another "Calgary Sellers" market this 2009 - 2010 winter?
October Sales solidify signs that the Calgary real estate market has rebounded, and in some cases, we have seen indicators reminicent of the start of the Calgary Sellers Market that stimulated the boom of the 2004-2005 era. I personally have experienced more than a handful of multiple offer situations recently where home prices are selling over asking price once again. Hence the increase in prices for Calgary homes and condos. For up to date information on the Calgary real estate market, or to find out if this is the right time to buy or sell please contact me so I can assess your current real estate situation.
Ps. Follow me on my facebookfan page for frequent Calgary Real Estate updates.
Paul Dojcinovic,
Calgary Realtor
Keller Williams Realty South
Direct line: (403) 608-2191
Email: paul@403realestate.com
Has the Calgary Real Estate market stabilized?
Good news for sellers as they are able to rest assured that the prices are no longer falling... BUT it is important to note that it is still very competitive and if they aren't shown as the best value in the buyers eyes, then they still will have a tough time selling to buyers who are still looking for deals.
It's also very good news for buyers, as their boost in confidence in the Calgary Real Estate Market, and the low interest rates, still make it affordable, especially for first time buyers entering the market.
With the most recent news of the Bank of Canada not raising the prime lending rate and reassuring that it will stay the same well into 2010, will keep the rates lower and allow for both buyers and sellers to benefit from the current situation.
I'd love to hear what you think... feel free to post your thoughts!
|  |