Dr. Sherry Cooper talks to MortgageBrokerNews.ca’s about the Bank of Canada’s recent rate decision as well as what to expect from the housing market in the coming year.
“Virtually all the housing market activity is in Vancouver and Toronto and I don’t expect to see 20% price increases. But activity will remain strong as will broker business,” Dr. Sherry Cooper, chief economist for Dominion Lending Centres
, told MortgageBrokerNews.ca. “Not as strong as last year; I think there will be a gradual slowdown instead of some sort of major shock.
The Bank of Canada held its overnight rate at ½% Wednesday. It was the expected move and the right one, according to Cooper.
“It was exactly as expected; it was one of the few times economists were unanimous in their opinion that the bank would stand pat,” Cooper said.
When announcing its decision, the BoC noted recent rebounds in oil and other commodities. Coupled with slight appreciation for the loonie, the central bank said economic conditions are evolving as assumed in its January policy report.
“Canada’s GDP growth in the fourth quarter was not as weak as expected, but the near-term outlook for the economy remains broadly the same as in January,” the bank said. “National employment has held up despite job losses in resource-intensive regions, and household spending continues to underpin domestic demand. Non-energy exports are gathering momentum, particularly in sectors that are sensitive to exchange rate movements.”