TD/ Canada Trust Economic Highlights – October 18


United States
• After last week’s ‘Goldilocks’ jobs report, the positive data stream continued for the U.S. economy, with
retail spending in September rising by the most in three months.
• Taken together, both reports provide confirmation that the American consumer will remain a key driver of
economic growth as we slowly approach the very important holiday shopping season.
• The data appear to be falling in line with expectations of most Fed officials telegraphed in the minutes of
the September FOMC meeting.
• Though a rate hike a week before the November election remains unlikely, the Fed looks increasingly
likely to slip in an increase before year-end so long as data continues to cooperate and downside risks
do not materialize.

• The shortened week was relatively quiet in Canada, with modest upward movement across most major
asset classes.
• All eyes remained focused on housing ahead of next week’s implementation of the federal government’s
latest round of cooling measures. Housing starts remain healthy on a trend basis, supported by rising
prices and demographic demand. Resale activity painted a different picture, with Toronto hot, but Vancouver
continuing to cool.
• The latest efforts at cooling housing markets should have some bite, with resale activity and prices both
expected to edge down in the coming year. A further headwind is likely to come from south of the border,
as rising U.S. interest rates pass through to Canadian mortgage rates.

For further information, please contact:

John Maveety Manager, Residential Mortgages – Greater Ottawa Area TD Canada Trust
T: (613) 371-1984 F: (888) 899-1984 P: (866) 767-5446
[email protected]