Good, quick, blurb by senior economist Benjamin Tal, in his latest 2010 Economic Buzz. In it he talks about the Feds willingness to keep rates where they are, currently. And it looks as though we can expect rates to hold here – certainly for the short-term.
Basically, Tal reminds us that the Bank of Canada (BOC) likely won’t be raising rates until June of 2010 at the earliest. And if growth numbers, for our country, are slower than expected that rate hike might stall for a bit longer. Tal says CIBC World Markets is, “roughly in line with the Bank of Canada’s growth projection for the balance of this year, (but) we’re not as optimistic about Canada’s ability to shrug off a likely slowing in US growth in 2010. If we’re right, it will take even longer than the Bank’s forecast to get back to full employment and target inflation. Therefore, if the US keeps rates on hold throughout 2010, it’ll be difficult for the Bank of Canada to move first, as long as the Canadian dollar is near parity.”
Interesting as this prediction comes just days before the Feds announced (Feb 16/10) several significant changes to the mortgage market – aimed at stabilizing the future mortage & housing market and off-setting or limiting any repurcussions of increased debt-loads owned by Canadians.
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