Canada is outperforming its global counterparts in steering its economy and managing potential landmines, says the International Monetary Fund. “Thanks to a decisive policy response, a resilient financial sector, and high commodity prices MORE >

The Canadian economy is not only creating more jobs, but it is also creating better jobs, according to report from CIBC. The bank's employment quality index found that the quality of jobs being created in Canada has improved over the last 12 months, and the measure is now back to pre-recession levels. Canada was one of the first among advanced countries to come out of the recession MORE >

One of the main responsibilities of the Bank of Canada is to ensure a low and stable rate of inflation. This objective has been put to the test by the federal government's economic stimulus program and strong consumer spending, largely financed by household debt. The rising value of real estate has created a "wealth effect", inciting consumers, who feel richer than they are, to take on debt to buy the goods and services they want. With debt now representing 148 per cent of personal disposable income, Bank of Canada governor Mark Carney and federal Finance Minister Jim Flaherty are worried that deterioration of household balance sheets poses a risk to the broader Canadian economy. Equally, there are concerns that the "wealth effect" will lead to inflation expectations, which could become a self-fulfilling prophesy. MORE >

The Bank of Canada is nearly certain to leave interest rates unchanged at Tuesday’s policy meeting. Canada’s economic growth is slowing below the bank’s forecast, underlying inflation is hardly an issue and the escalating debt crisis in Europe is just one of several international concerns. These are definitely not the conditions in which to hike interest rates.But step away from the immediate concerns and the bigger picture looks far brighter than you may realize. Whatever short-term stresses there may be, Canada is doing better than the United States. And a big part of the credit goes to our central bank and our federal government. MORE >

Most Canadians agree that buying a home is a good long-term investment and are focused on their mortgages to support that investment. Many mortgage holders are making voluntary additional payments: 16 per cent have increased monthly payments during the past year, 12 per cent have made lump sum payments, and 7 per cent did both. Canadians are exercising caution when taking out their mortgages, with a majority choosing a fixed-rate (66 per cent). A five-year fixed-rate mortgage remains the most popular option in Canada. Despite the fact that variable rate mortgages have become much less expensive compared to fixed rates, the majority choice is still fixed rates: this decision is based on people's individual assessments of risk, not just the cost difference. MORE >

TD is making a big change with respect to how it registers its mortgages. Effective October 18, all new TD mortgages will be registered as “collateral charges.”A collateral charge is a different way to secure a home loan than a standard mortgage. "The terms of a collateral mortgage are outlined in a loan agreement that's not registered," says Invis's Gary Siegle. "With a regular mortgage, the terms are in a 'registered document'."Effectively, collateral charges allow lenders to change the interest rate and/or loan more money to qualified borrowers after closing, without involving a lawyer.* That saves the borrower legal costs if he/she needs to withdraw equity from their home.In TD’s case, customers will now be able to register their mortgage for up to 125% of the value at closing. Hence, if one’s property value goes from $200,000 to $250,000, qualified borrowers will be able to withdraw most of that new equity without refinancing. MORE >

Canadians scouring want-ads or those nervously hoping they'll hang on to their jobs are unlikely to get much comfort from job figures in the coming months as the unemployment rate is expected to stubbornly hover around the eight per cent mark, experts predict.As the engines of economic growth gear down — to a mere two per cent of Gross Domestic Product in the latest quarter —Canadians should get used to seeing the number eight in headlines and feeling its effects on their finances.Economists say the eight per cent unemployment rate will persist and cast a pallor on prospects for hiring and income levels into next year.“The two per cent GDP growth (in the second quarter) portends that we're going to see a slower rate of job growth going forward,” said Derek Burleton, deputy chief economist at TD Economics.August jobs figures, to be released Friday by Statistics Canada, could put a small dent in the number of jobless Canadians, but it's difficult for one month to have much effect.So far this summer job figures have been mixed, with a whopping 93,000 jobs added in June before a loss of 9,300 in July — the first downturn in job growth since December. July's losses ratcheted t... MORE >

While the U.S. economy continues to be treading water, things are in fairly decent shape in British Columbia as we go into the second half of 2010.Last week Statistics Canada released an employment report showing the B.C. province gained 16,000 jobs in July, lowering its unemployment rate to 7.5 percent. That's better than the rest of Canada, which lost jobs last month and has an unemployment rate of 8 percent. The U.S. unemployment rate remained at 9.5 percent in July, while the Washington state rate was 8.9 percent in June and Whatcom County was 7.8 percent in June, the most recent months for which we have state and local numbers.It's a bit of a change for B.C.'s economy, which historically tended to get hit harder than most nearby economies in recent recessions. Part of the reason is B.C.'s economy is much more diversified now, said Christopher Lawless, chief economist at British Columbia Investment Management Corporation in Victoria. The growth of new industries beyond timber, combined with a decent housing market and governments running relatively low deficits, has kept the provincial economy rolling along in the first half of 2010. MORE >

Bay Street economists are betting the Bank of Canada will raise interest rates again in July even though the central bank governor reinforced yesterday that more hikes are no sure bet as government austerity threatens global growth.In a speech in Charlottetown, Mark Carney said "considerable uncertainties" remain in the global economy, and that the paring back of debt among households, banks and countries had "barely begun, and will ... temper the pace" of global growth.The central bank raised its key interest rate by 25 basis points on June 1, based on stronger-than-anticipated domestic growth. Prior to yesterday's speech, the betting among economists and traders was for Mr. Carney to increase rates again on July 20.Mr. Carney, however, appeared to dampen expectations yesterday, arguing any further removal of stimulus from the strongest Group of Seven economy over the next two years had to be balanced against global developments."In light of the scale and volatility of these conflicting forces," Mr. Carney said, "it should be evident that no particular path for monetary policy is preordained."Still, economists said they believed there is enough ju... MORE >

It's hard to believe, but barely six months out from what was looking like a prolonged housing bust and some "experts" are already warning Canada risks the sort of housing bubble experienced in the U.S.This has led some commentators to call for added restrictions on mortgage lending, including higher down payments and shorter amortizations.Our industry opposes such measures and Finance Minister Jim Flaherty's move to tighten rules for government-backed insured mortgages, effective April 19.We do not believe such changes are justified or needed. We have made our concerns clear in submissions to the federal government, arguing unwarranted restrictions on mortgage insurance could damage both the return of jobs in our industry, and Canada's overall economic recovery.Housing markets in Canada are healthy and stable, and housing demand is supported by economic fundamentals and sound lending principles. While historically low interest rates have helped motivate many Canadians to buy a new home, there is little evidence this is leading to excessive risk-taking by borrowers.We are not alone in this view. The Bank of Canada, Department of Finance and Canada Mortgage and Housing Corp. all hav... MORE >

The International Monetary Fund  lifted its forecast for Canada's economic growth Tuesday, saying it will likely expand 2.6 per cent in 2010.Its previous forecast was 2.1 per cent growth this year. The Canadian economy will expand 3.6 per cent in 2011, the IMF said in an update to its world economic outlook.The global economic recovery is stronger than the IMF had expected as global trade stabilizes and commodity prices climb. It boosted its outlook for global output to 3.9 per cent this year from its October prediction of 3.1 per cent.“The global recovery is off to a stronger start than anticipated earlier,” it said in a statement, though growth rates differ in various regions.“In most advanced economies, the recovery is expected to remain sluggish by past standards, whereas in many emerging and developing economies, activity is expected to be relatively vigorous, largely driven by buoyant internal demand.”The latest IMF prediction is still lower than the Bank of Canada's projection for this year. The central bank said last week it expects the economy will grow 2.9 per cent this year and 3.5 per cent next year, after an estimated 2.5-per-cent contraction in 2009. MORE >

Jan. 19 (Bloomberg) -- The Bank of Canada will probably keep its benchmark interest rate at a record low today, and repeat a pledge to leave it unchanged through June as an appreciating currency threatens to hamper the economic recovery.                           The target rate for overnight loans between commercial banks will remain at 0.25 percent, where it’s been since April, according to all 26 economists surveyed by Bloomberg. The decision will be announced at 9 a.m. New York time.“Any suggestion they will raise rates before the U.S. would probably drive up the currency, and we’ve already had concern from the bank that the very high dollar would derail the recovery,” said Pedro Antunes, director of economic forecasting at the Conference Board of Canada in Ottawa. “They will be hesitant to make any changes” today, he said.Inflation slower than the central bank’s 2 percent target means Governor Mark Carney is unlikely to break his pledge to freeze rates until the second half of the year. Carney has said the economy will operate with “slack” through the middle of 2011 as exports are curbed by the ... MORE >

Bank of Canada Governor Mark Carney spoke to the media after the central bank released its quarterly Monetary Policy Report on Thursday.Following are highlights from a briefing and later television interview:ON GDP GROWTH"We had a less severe recession than other major economies. We will get back, in our view, to our peak, the peak of GDP that we were at, sooner than other major economies. We expect to be there around about the third quarter of this year."ON RISING HOUSEHOLD DEBT LEVELS"Canadians do know what more normal interest rates are like, and in some respects it's a statement of the obvious to say, 'Manage your personal finances so that you can comfortably service your debts in a more normal interest rate environment.' Are we more concerned? We're certainly more concerned than we were a year ago."ON INTEREST RATE HIKES"We made a decision on Tuesday. We're still in a position where we're providing exceptional guidance on where we think interest rates are going to be, which is the same level, conditional ... on the outlook for inflation through the end of June," he said."To be honest, (we) don't feel compelled to provide any further guidance at this stage beyond that."ON PRIVA... MORE >

Canada will beat out average G7 economic growth this year and next, the International Monetary Fund said Tuesday.The global economy is bouncing back from negative territory quicker than expected and will grow 3.9% this year, the IMF said in its World Economic Outlook.Vigorous growth in Asia combined with surprising strength in U.S. consumer demand led the IMF to revise its October growth projection of 3.1%.But, the IMF said, the recovery is proceeding at different speeds in different countries and advanced economies remain “sluggish.”Canada is considered part of that slower pack with estimated growth coming in below the world average at 2.6% for the year. Still, however sluggish, economic growth in this country will outperform other advanced economies, such as the U.S., U.K., Euro area and Japan, which as a group will see average growth of 2.1%.The pace of recovery Canada should pick up steam in 2011 at 3.6%.The problem for Canada and other industrialized economies is a heavy reliance on government stimulus measures.“For the moment, the recovery is very much based on policy decisions and policy actions,” said IMF Chief Economist Olivier Blanchard in an IMF video interview.�... MORE >

Consumers, along with government spending, will be the main source of economic growth in 2010, while the private sector continues to struggle, the Conference Board of Canada said Tuesday.The board forecast the Canadian economy will grow 2.8 per cent in 2010, just a percentage point shy of the 2.9 per cent forecast Tuesday by the Bank of Canada in announcing it was standing pat on interest rates, leaving its benchmark rate unchanged at a record low 0.25 per cent."Canada's economic outlook is much brighter than it looked this time last year, but the forecast for recovery remains muted," said Pedro Antunes, director, national and provincial forecast."Fiscal stimulus by government is expected to bolster the economy and will compensate for soft growth in private sector investment and exports. Propped up by low borrowing rates and rising confidence, consumers will loosen their purse strings in 2010."With industry still running at record low capacity, private investment is expected to be the weak point of the domestic recovery and will grow by only 3.4 per cent in 2010 after falling by an estimated 14.5 per cent in 2009, the board said.The outlook was also in line with the bank's expectat... MORE >