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Brent Richardson
Principal Mortgage Broker/ Owner (Lic. # M08006143), Certified Financial Planner (CFP) Altrua Financial Inc. Lic. #13005
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Ground Level Updates on Mortgages and the Housing Market, before it hits the news
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BREAKING: 🇨🇦 real GDP plummeted in Q2, shrinking by 0.4% driven by a sharp 7.5% drop in 🇺🇸 exports
The damage is here, but not as bad as originally expected in June
Bond yields are down marginally on the news, with no upward fixed mortgage rate pressure currently
Dovish hints for a 🇺🇸 Fed cut have many north of the border hoping BoC will follow in Sept
However BoC is likely to hold until 🇨🇦 economic deterioration pulls the BoC preferred, core inflation measure below 3%
Current market odds dont offer much reward (.25%) for VRM risk
BREAKING: 🇨🇦 CPI/ headline inflation fell by 0.2% in July to 1.7% lead by lower gasoline prices
However excluding gas, inflation was 2.5%, matching the May and June readings
The 🇨🇦 5 yr yield is down ~1% on the news
🇺🇸 treasuries/bonds increased on an inflationary surge in PPI to 3.7%, its fastest since Mar '22
This pushed 🇨🇦 bonds higher, dampening hopes of lower fixed rates near term
🇨🇦 headline inflation is expected to hold at 1.9% on Tues, with core inflation measures closer to 3%
Bond markets seemingly shrugged off the biggest 🇨🇦jobs market decline in over 3 years, with yields down just a touch
No upward pressure on fixed rates currently, but we'll need to see another ~ (-) .20 lower yields to see fixed rates dip meaningfully
Canada is in recession.
Canada lost 40.8K jobs in July, below all estimates.
Youth unemployment rate reached its highest level since 2010, per Statcan.
Between this and a 90% chance of Fed cuts in September, I'd say there's clear runway for more cuts in Canada now.
🇨🇦 bond yields plunged on weak 🇺🇸 jobs data, and spiked the odds of a 0.25 US Fed cut in Sept to 96%
However, chances of a Sept BoC hold remains high at 77%, as 🇨🇦's effective 🇺🇸 tariff rate is ~6.3% due to CUSMA
Look out for 🇨🇦 jobs report Friday for potential yield swings
*BREAKING* The Bank of Canada extends its pause for a third time, holding its overnight rate at 2.75% as it monitors inflation and economic uncertainty
Most lenders have increased fixed rates ~0.10 but one rebellious big bank actually lowered their 5 yr fixed insured, as low as 3.84% through our Brokerage
BoC cuts not likely this month or September, however if job losses materialize in the Fall we could see a cut by years end
We are Mortgage Brokers proudly serving customers from 5 locations in Ontario.
Kitchener/ Waterloo (Head Office)
In Kitchener Waterloo Call: 1-877-248-9210
Hamilton
In Hamilton Call: 905-538-0677
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