What BoC rate hikes would mean for Canada’s housing market
Meetings showed “a range of views” among Governing Council members about the economy’s resilience, the Bank revealed, with growing concern about the possibility of rising oil costs impacting prices elsewhere.
“The longer oil prices remain elevated, the bigger the risk that their inflationary effects broaden,” the Bank said. Members emphasized they “would not let higher oil prices lead to persistent inflation.”
The fact that most economists see rates staying on hold for the rest of the year is at least a positive sign, but Fox also doesn’t predict any chance of Canadian consumer and homebuyer sentiment improving until news of a lasting ceasefire in Iran emerges.
There’s no sign of that happening yet, even with the six-month anniversary of the beginning of the war nearing at the end of August.
“For anything to move to the real, notable positives, you’d almost need both of those things to be true [rate holds and an Iran truce],” he said. “And it doesn’t seem overly likely at this point.”
