Akin to one of my recent posts, involving an article from the Financial Post, another article (from the same publication) is worth noting. And this one talks more about the condition and progress, if you will, of the Canadian economy.
Overall, it seems Canada’s economic train is chugging along fairly smoothly. Sure, we’d probably all like it to be even stronger than it is now, but hey – let’s remember where things were and then focus on where they are:
“…economic data indicated the Canadian economy grew at a robust 5% annualized pace in the final three months of 2009, blowing past market expectations for a 4% gain and the central bank’s original 3.3% forecast. Economists say the fourth-quarter performance has set the stage for another robust gain, of perhaps 4% or more, for the first three months of 2010.”
Combine this statement with some of the latest information highlighting the country’s pent-up demand for real estate, record low interest rates set since, basically, Q4 of 2008, and few of us should be surprised our economy has made it through. Sure, the naysayers and pundits will tell you that the picture isn’t as rosy as we think it is. Fair enough. But the fact we’re even above a lot of experts’ previous economic projections (for Q1 of 2010) is significant.
So now we wait and watch to see what the central bank will do. Certainly I think we can expect to see them raise the prime rate to a level which will reflect the health of our economy at that time. And certainly I think it’s fairly safe to assume not much will change until July. But after that, let the fireworks begin.
If we are, in fact, 150 basis points higher in December of 2010 – than we are currently (when it comes to raising the prime rate) this obviously won’t be the last we’ll hear of the state of the economy and our national real estate market.
Thoughts? Where do you think we’ll be at the end of 2010?
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