19 Quotes by Paul Ferley

Bubble conditions may not be present yet but are approaching such and thus require close monitoring going forward. To allay this concern, housing price increases will need to start to moderate soon from recent sharp increases. Our expectation is that this should occur, since rising mortgage rates should slow the growth in housing prices to a rate below gains in income.

Given that we import a lot of capital equipment, this further strengthening of the Canadian dollar does make a lot of those investment goods that much cheaper.

Recent comments by Fed officials on indications that the U.S. economy had a fair bit of momentum going into the natural disaster seems to have resulted in the consensus of the Fed continuing to hike rates,

Markets are probably waiting for the announcement by the Bank of Canada tomorrow to get a sense of the characterization of the near-term outlook for policy: whether they'll flag they're poised to move to the sidelines or whether they're still contemplating further rate hikes.

This statement did imply a slightly less aggressive tone relative to its previous statement.

We saw most of the indicators move up in the month, with the exception of the prices paid index, which generally provides an indication of strength in activity.

Bottom line is it's not flagging any inflation pressures, at least on a core basis.

Pressures are particularly evident in the West where housing prices in local markets such as Riverside-San Bernardino (outside of Los Angeles) and Las Vegas are rising rapidly with an attendant marked deterioration in affordability. Rising prices in those areas seem more the result of speculative pressures and thus indicative of local housing market bubbles. There is the definite risk in these markets that prices will eventually need to correct sharply lower.

Despite solid growth, inflation is quiet which is reflected in low bond yields.