The Bank of Canada released its quarterly monetary policy report on Thursday morning, two days after it caused turbulence in currency markets when the bank reiterated its commitment to keeping interest rates unchanged until at least next June.
The report provided some more information about that commitment, making specific references to the Canadian housing market, which has been picking up lately - to the point where some observers believe it is being fed by low rates.
Here's what Eric Lascelles, chief economics and rates strategist at TD Securities, said in a note: "A telling message that continues to be sent is that the strength of the Canadian dollar is the more important factor than housing market strength," he said.
"In fairness, the housing market did receive more ink than it did on Tuesday, but the references were still quite calm. Recent strength was characterized as being primarily due to 'pent-up demand for housing,' and the overall assessment was still fairly blasé: 'the housing sector appears to have bottomed out, and some firming in house prices is evident.' There is nothing to suggest the Bank of Canada has any desire to go on the warpath against rising home prices, despite Governor Carney's earlier sympathetic comments towards leaning into asset bubbles."
David Berman