MLN NewsStream

"Inflation should be within that [1-3%] band about three-quarters of the time"
—BoC Governor Tiff Macklem (source)

• Opportunity to reassure borrowers: 77% of mortgagors are "worried" about borrowing costs ballooning at their next mortgage renewal, according to this Angus Reid survey. The number is similar for both variable and fixed-rate borrowers. So what better time to create a touch point with mortgage clients, letting them know how they could be affected at maturity and listing their options? Proactive outreach on stressful topics builds loyalty. The borrowers most receptive to such advice are first-time mortgagors and those who may be overextended (e.g., highest GDS/TDS ratios at origination). Angus Reid suggests 91% of first-time borrowers have this concern.

Seems like every economics shop on the Street is talking about real estate's "comeback."

Cases in point...

"A hot job market, robust income growth, rollicking population increases, a tight rental market, some clarity on the rate front—all roads point to revival" in the housing market, wrote BMO Economics this week.

Central bankers won't be loving Friday's employment numbers.

Canada created an overspicy 41,000 jobs in April, doubling up the consensus forecast (which is wrong 4 out of 5 times, by the way, reports Scotiabank). Immigration-fuelled population growth distorts employment gains, so potent job creation isn't as inflationary as one might think.

The U.S. Federal Reserve gave no indication it was pressing the pause button after Wednesday's 25 bps hike. Instead, it said the next best thing.

"A decision on a pause was not made today," Jerome Powell remarked in his press conference. But "We feel like we are close, or maybe even there...We're no longer saying that we “anticipate” [further policy firming]."

That's about as much as you're going to get from a Fed worried that it may not have done enough to ensure inflation is headed back to 2%.