US Housing Market Chart Pack Mortgage interest rates drop back to under 4% The turmoil in financial markets during February led to a flight to safe assets which pushed the 10-year Treasury yield down to 1.78%, its lowest level since early 2013, and also led to a drop in... 7th March 2016 · 1 min read
Canada Economics Weekly Deficit paranoia is mind-bogglingly stupid The hysterical response to the news that the Federal budget deficit might increase to as much as $30bn next year left us shaking our heads in dismay. Canadian economists are still stuck in the Paul... 4th March 2016 · 1 min read
US Economics Weekly Is the rise in auto loans a concern? The rapid growth of auto loans in recent years has prompted claims that the next unsustainable debt bubble is emerging. For now, however, there appears to be little cause for concern. Although the... 4th March 2016 · 1 min read
US Data Response Employment Report (Feb.) With employment rising at a rapid pace and labour market slack still shrinking, we think the Fed will resume raising interest rates in June. A marked pick-up in wage growth is still notably absent... 4th March 2016 · 1 min read
Canada Data Response International Merchandise Trade (Jan.) Despite the modest rise in the monthly trade deficit to $0.7bn in January, from $0.6bn, the big 3.6% m/m surge in export volumes is good news. The balance of risks to our forecast that first-quarter... 4th March 2016 · 1 min read
Global Markets Update What should we make of the latest decline in TIPS yields? The real yields of US Treasury Inflation Protected Securities (TIPS) have fallen since the US stock market hit a trough on 11 th February. The likely explanation is that investors have become more... 3rd March 2016 · 1 min read
US Housing Market Data Response Mortgage Applications (Feb.) The slight 5.2% m/m fall in mortgage applications for home purchase in February is not a sign that housing demand is tailing off. With mortgage affordability set to remain favourable and more... 2nd March 2016 · 1 min read
Bank of Canada Watch Bank won’t cut rates again until after Budget The Bank of Canada is unlikely to cut interest rates at the upcoming policy meeting on 9th March. But we still anticipate that the ongoing economic slump, triggered by the collapse in commodity prices... 2nd March 2016 · 1 min read
US Data Response ISM Manufacturing Index (Feb.) Despite the rebound in the ISM manufacturing index to a five-month high of 49.5 in February, from 48.2, the factory sector continues to be battered by the strong dollar and weak global demand. The... 1st March 2016 · 1 min read
Canada Data Response GDP (Q4 2015) It underlines how bad things have become in Canada that the 0.8% annualised increase in fourth-quarter GDP, above the consensus forecast for no change, will be celebrated as some sort of economic... 1st March 2016 · 1 min read
US Economics Weekly Consumption growth rebounds The slowdown in real consumption growth to a more modest 2.0% annualised in the final quarter of last year was a disappointment, particularly as households were benefitting from a further decline in... 26th February 2016 · 1 min read
Canada Economics Weekly Stubbornly high inflation adding to the pain The rebound in headline inflation in January back to the mid-point of the Bank of Canada’s 1% to 3% target range illustrates that the markedly weaker Canadian dollar isn’t all good news. Strong goods... 26th February 2016 · 1 min read
US Housing Market Update How important are foreclosures for housing inventory? The return to more normal levels of foreclosure activity has removed one factor that was helping to support the inventory of existing homes for sale. But foreclosures are clearly not a sustainable way... 25th February 2016 · 1 min read
US Employment Report Preview Pace of employment gains will inevitably slow Our econometric model points to a more muted 180,000 gain in non-farm payrolls in February. We estimate that the unemployment rate was unchanged at 4.9%, with the growth rate of average hourly... 25th February 2016 · 1 min read
US Data Response Durable Goods (Jan.) The 4.9% m/m increase in durable goods orders in January was flattered by a strong rebound in the notoriously volatile aircraft component, but details of the report bode well for equipment investment... 25th February 2016 · 1 min read
US Housing Market Data Response Case-Shiller Prices / Existing Home Sales (Dec./Jan.) The surprise rise in existing home sales in January provides further evidence that housing demand is being supported by very low mortgage interest rates and a strong jobs market. But with inventory... 23rd February 2016 · 1 min read
