- Stephen Poloz, Bank of Canada Governor
Building permits in Canada rebounded in September after a sharp drop in the preceding month. The value of Canadian building permits jumped as much as 12.7% in September to C$7.50 billion ($6.58 billion), beating analysts' estimates for an increase of 6.0% following the 27.3% plunge in August. According to Statistics Canada, higher construction intentions for both non-residential and residential buildings in Ontario, Canada's most populous province, drove the increase. Overall, the value of permits for residential buildings across the country soared 6.1%, while non-residential permits surged 23.9%. Low interest rates have underpinned home purchases in recent years, while lifting household debt burdens to near-record levels.
Canadian policy makers have been increasingly expressing concerns over the nation's continuously expanding residential sector, specifically in in the environment of low interest rates. The Bank of Canada last month kept its key interest rate at 1%, extending the longest pause since the 1950s. The central bank Governor Stephen Poloz says the economy needs to shift to exports and business investment from debt-fuelled consumer spending.
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