On Wednesday a very confident Bank of Canada governor Poloz increased the key central bank interest rate to 75 from 50 basis points. Yesterday the IMF released a report on the country, written before the hike, warning that the business investment remained weak, non-energy exports are under-performing, housing imbalances have increased and trade negotiations with the US are uncertain indeed. This against a backdrop of record high household borrowing and an economy heavily reliant on the construction industry and property more generally (where many feel it’s a bubble).
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