The Canadian economy expanded for a third consecutive month in May, growing 0.2 per cent on a monthly basis. The rise in GDP was the result of higher output in 13 of 20 industrial sectors, led by manufacturing, construction and transportation. Activity at offices of real estate agents and brokers jumped 4.8 per cent in May due to increased home sales in the Greater Toronto and Greater Vancouver.
With today's GDP report, we are tracking second quarter growth in the Canadian economy at 3 per cent, a major improvement from the sub-1 per cent growth of the first quarter. Stronger growth and inflation at or near its 2 per cent target should keep the Bank of Canada sidelined in 2019. However, with the US Federal Reserve expected to lower its key policy rate this week, it is possible the Bank will follow suit. Either way, Canadian mortgage rates will likely remain near their current low levels for the foreseeable future.
Copyright British Columbia Real Estate Association. Reprinted with permission.