MLN NewsStream

The Bank of Canada's job isn't done—judging from the hike and a half now priced into the #OIS# market this year.

Markets see what the BoC sees: stubborn perkiness in labour, services and housing markets, with core inflation plateauing.

The Bank of Canada knows rates are restrictive but worries they're not restrictive enough. Real rates are still low compared to pre-#GFC# rate cycles. And if the late 1970s (chart above) taught central banks anything, it's that they can afford only so much patience with lagging monetary effects—before running the risk of inflation expectations re-igniting. A dangerous scenario like that could drag out this hiking cycle far longer than necessary.

Where are these lagged effects?

Multiple online brokers have launched in-house lenders in recent years. But this one's different.

This one is Rocket Mortgage Canada, sister company to Rocket Mortgage, the largest retail lender in the United States, with $133 billion (USD) in originations last year.

Rocket Canada's shiny new lender launches on Monday, and it's got the brand and backing to make an impact in Canada's mortgage space. To learn how much of an impact, MLN spoke with Hash Aboulhosn, Co-Founder & President of Windsor, Ontario-based Rocket Mortgage Canada.

Should consumers be excited—and competitors worried? Here's what he told us...

• BoC meeting odds: The #OIS# market now implies a 33% chance of a BoC rate hike on June 7. Another 25 bps increase is almost fully priced for September 6. The market sees the first cut now in spring 2024, but that's eons away in bond time. If incoming data—especially unemployment—start coming in weaker, which is a high probability, cut timing would be pulled forward once again.

CIBC officially stopped selling mortgages through brokers in 2012. But, while few know about it, the bank has been back in the broker channel for some time now.