MAY’S SOFTER LABOUR MARKET DATA ENDED THE LONGEST RUN OF JOB GAINS SINCE 2017

Ironically, the May Labour Force Survey showed a modest slowdown two days after the Bank of Canada surprised the markets by raising interest rates. Employment was little changed in May, down 17,300, all for youth aged 15 to 24. All other age cohorts enjoyed continued rapid job gains. Total hours worked fell 0.4% but were up 2.2% year-over-year. 

Wages rose by 5.1% last month, a moderate decline from the prior three months. 

The employment rate—the percentage of people aged 15 and older—declined by 0.3 percentage points to 62.1% in May. This reflected strong population growth in the month (+83,000) and little change in employment.

Following five consecutive months of a low 5% unemployment rate, the jobless rate rose 0.2 percentage points to 5.2% last month. This was the first monthly increase since August 2022. According to the median estimate in a Bloomberg survey, the figures missed expectations for a gain of 21,300 positions and a jobless rate of 5.1%.

The data for May concluded the most extended streak of job growth since 2017, during which a total of 423,900 new roles were generated. However, the extent of job losses was deemed statistically negligible, failing to counteract even half of the employment gains observed in April. Despite these losses, wages continued to rise robustly, marking over a 5% annual increase for the fourth consecutive month. This underscores a persistently tight labour market and a resilient economy, undeterred by escalating borrowing costs.

Bottom Line

Following an unanticipated robust beginning of the year, Canada’s employment market demonstrated dynamism well into the second quarter. A confluence of factors, including a tight labour market, solid economic growth, persistent inflation, and a resurgence in housing market activities, propelled Governor Tiff Macklem and his team to increase the overnight lending rate to 4.75% on Wednesday. This hike came after a previously announced halt in January. Policymakers perceived the enduring excess demand in the economy as “more persistent than anticipated.”

It seems improbable that the Bank of Canada would disrupt the interest rate pause that commenced in January merely for the 25 basis point interest rate increase. A single employment report exhibiting softer figures doesn’t constitute a new trend, especially considering that historically, the labour markets remain extraordinarily tight. Before the following decision on interest rates is due on July 12, we anticipate another jobs report, the May Consumer Price Index (CPI) report, and the Bank’s intensely scrutinized Business Outlook Survey. While we project a continued trend of softer data releases over time, it would likely require further unexpected downturns to derail plans for another rate hike in July.

(This article is courtesy of the Sherry Cooper Assoc.)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Holy Smokes, The Bank of Canada Means Business

If there were any doubt that the Bank of Canada wanted inflation to fall to 2%, it would be obliterated today. In a relatively surprising move, the Bank hiked the overnight policy rate by 25 bps to 4.75%, and an equivalent hike will follow in the prime rate. Fixed mortgage rates had already leaped higher even before today’s move as market-determined bond yields have risen in the wake of the US debt-ceiling debacle. Now variable mortgage rates will increase as well. The central bank is determined to eliminate the excess demand in the economy.

“Monetary policy was not sufficiently restrictive to bring supply and demand into balance and return inflation sustainably to the 2% target,” the bank said, citing an “accumulation of evidence” that includes stronger-than-expected first-quarter output growth, an uptick in inflation and a rebound in housing-market activity.

I had thought that the Bank would want to see the May employment data and the next read on inflation before they resumed tightening, but with the substantial May numbers in the housing market, the Governing Council jumped the gun.

The Reserve Bank of Australia did the same thing earlier this week. But their economy was already softening. On the other hand, the Canadian economy grew by a whopping 3.1% in the first quarter and is likely to surprise on the upside in Q2, boosted by a strong rebound in housing. If the correction in housing is over, then the Bank has failed to cool the most interest-sensitive sector in the economy. Governing Council fears that inflation could get stuck at levels meaningfully above the 2% target.

Bottom Line

The next Bank of Canada decision date is a mere five weeks away. While we will see two labour force surveys and one inflation report, the odds favour another rate hike before yearend. The BoC concluded in their press release that, “Overall, excess demand in the economy looks to be more persistent than anticipated.”

No doubt, if the data remain strong over the next several weeks, another 25 bps rate hike is likely in July. Deputy Governor Beaudry will flesh out today’s decision in his Economic Progress Report tomorrow.

(This article is courtesy of the Sherry Cooper Assoc.)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Bank of Canada has increased their overnight rate by 25 basis points, pushing prime to 6.95%. Although this was partly anticipated by the market, it is the Bank’s first-rate hike since January. The highest rate since April 2001.

This move impacts variable rate mortgage holders and those with a Line of Credit of approx. 14 dollars per 100k in borrowed funds In the Bank’s announcement, it stated that consumption growth has been “surprisingly strong,” and the rise in inflation in April was a key reason for the decision. As a result, the Bank determined that the current monetary policy was not restrictive enough to restore the balance between supply and demand. Hikes will not be over if inflation continues to rise.

The next announcement is July 12^th, 2023. If you’re wanting to chat further about this and what mortgage options are available to you, connect with us at angela@countoncalla.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

The First Home Savings Account (FHSA) is specifically designed to help first-time homebuyers save for their down payment without having to pay taxes on the interest earned on their savings.

This means that the interest earned on the savings in the account is not taxed, nor are withdrawals from the account. 

Plus, since your contributions to this account are not taxed, your money will have the opportunity to grow faster in an FHSA than a traditional savings account.

If you are interested in creating a FHSA, there are a few things to note:

• This savings account is eligible to Canadian residents who are at least 18 years of age.
• You are a first-time homebuyer – you and/or your spouse or common-law partner have not owned a home where you lived in the year in which you open the account or at any time in the previous four years.
• Allows you to contribute tax-free for up to 15 years.
• The maximum contribution is $8,000 annually, plus up to $8,000 of your unused contribution room*.
• Maximum lifetime contribution limit is $40,000.
• Setting up automatic contributions can help you stay on track.

*You can carry forward any unused FHSA contribution room from the prior years up to a maximum of $8,000 (subject to your lifetime contribution limit of $40,000). Therefore, if you contribute less than $8,000 in a given year, you can contribute the unused amount in a subsequent year in addition to the $8,000 annual contribution limit for that year.

Another thing to consider is combining the First Home Savings Account (FHSA) with the Home Buyers’ Plan (HBP) to help you purchase a qualifying home. The Home Buyers’ Plan (HBP) allows you to withdraw up to $35,000 from your RRSP to buy a home. Keep in mind, you will need to repay the amount you draw for the Home Buyers’ Plan within 15 years back to your RRSP, PRPP or SPP.

If you are interested in setting up an FHSA or learning more, please don’t hesitate to contact me today!

(This article is courtesy of the DLC June Newsletter)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

As we enter the halfway point of the year, here is an update of three key points to keep in mind:

• The Bank of Canada meets next week, and while they may hold, we recommend bracing for another potential hike before the year ends based on inflation numbers.
• If you are up for renewal or considering a purchase don’t delay reaching out for a rate hold as we have seen fixed rates move up already with some lenders and planning is your key to saving money. Also, download our app to test modifying your payment schedule.
• High Interest Saving Accounts are a great way to have your money 100% protected, liquid, and earning interest while you sleep. It’s also the best way to utilize your prepayment privileges as it stretches your dollar, further assisting with paying down your mortgage faster as any additional payment is applied directly to your principal. I recently opened an account myself for my own mortgage prepayment strategy through one of our financial planning partners and got a way better rate than the banks were offering.

If you would like to learn more, reach out to our team with the best email and phone number to reach you at and we can make an introduction for you.

The Angela Calla Mortgage Team

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

We hope this email finds you well. We are writing to remind you that the due date for your property tax payment is fast approaching and is due by July 4, 2023. It is crucial to submit the payment to the designated taxing authority by the due date.  Failing to meet the deadline may result in late payment penalties and interest charges, as well as potential negative consequences on your mortgage and property ownership.

We recommend taking the following actions:

Claim Grant(s): Please review the tax amount provided and ensure it aligns with your records. Regardless if you or your lender are making your property tax payments, you still have to claim the homeowners grant (HOG), or deferral if applicable to you.  In case of any discrepancies, kindly contact your local tax authority for clarification.

Arrange Payment: To facilitate a seamless transaction, we suggest making your property tax payment as soon as possible. There are typically several payment options available, such as online payment, mail-in check, or in-person payment. Choose the method that suits you best and initiate the payment process promptly.

Retain Proof of Payment: After submitting your property tax payment, keep a copy of the transaction receipt or any supporting documentation as proof of payment. This will serve as an important record and may be required for future reference.

If you have any questions or concerns regarding your property tax payment, please do not hesitate to reach out to our team. We are here to support you throughout this process.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Good News Is Bad News For The Bank Of Canada

The Canadian economy continues to show marked resilience to high-interest rates. Statistics Canada released data this morning showing real GDP rose at an above-consensus 3.1% annual rate in the first quarter of this year. The estimate for April growth was also firm, a harbinger of continued strength in Q2. The combined drags of the public sector strike and the Alberta wildfires didn’t cause a significant downdraft.

First-quarter growth was driven by strong international trade and robust household spending. These factors were partly mitigated by slower inventory accumulation and declines in new housing construction and business investment in machinery and equipment.

After two quarters of minimal growth, household spending rose for goods (+1.5%) and services (+1.3%) in the first quarter of 2023. Expenditures on durable goods (+3.3%) were driven by motor vehicles, including new trucks, vans, and sport utility vehicles (+7.8%). Spending on semi-durables (+4.3%) was led by garments (+4.5%), while spending on non-durable goods (-0.2%) declined slightly.

Service spending picked up in the first quarter of 2023, led by food and non-alcoholic beverage services (+4.4%), and alcoholic beverage services (+6.5%). Meanwhile, travel was on the rise, with expenditures by Canadians abroad up 6.8% in the first quarter, compared with a 3.3% decrease in the previous quarter.

These data do not portend a household sector overly burdened by rising mortgage and credit card payments.

Coinciding with higher borrowing costs and slowing mortgage borrowing, housing investment fell 3.9% in the first quarter of 2023, the fourth consecutive quarterly decrease. The decline in investment was widespread—as new construction (-6.0%), renovations (-2.1%), and ownership transfer costs (-1.5%), which represents resale activity, were all down.

We know housing activity has picked up considerably since the first quarter, undoubtedly adding to Q2 growth. Also expansionary is the persistent rise in employee compensation, led by salary gains in professional and personal services, manufacturing and construction.

One warning sign is the declining household savings rates and slower disposable income. Persistently high interest rates had a predominantly negative effect on net property income, as increases in interest income (+6.4%), mainly from deposits, did not keep pace with higher interest payments on mortgages (+14.7%) and consumer credit (+10.9%).

In contrast with lower disposable income, consumption expenditures (in nominal terms) rose 2.1% in the first quarter of 2023. This was faster than the 1.4% pace recorded in the fourth quarter of 2022, partly due to inflationary pressures. As a result, the household saving rate was 2.9% in the first quarter of 2023, down from 5.8% at the end of 2022. The household saving rate approached the pre-pandemic level, which averaged 2.1% in 2019.

Business incomes fell significantly in Q1, and judging from the stock market, corporate earnings news has also been disappointing across a wide array of sectors in the second quarter.

Bottom Line

The strength in today’s data and the higher-than-expected inflation number for April will cause the Bank of Canada to seriously consider raising the overnight rate by 25 bps to 4.75% when they meet again next week. I think they will hold off to see the May employment and inflation data before they pull the trigger.

Markets have already responded to the numbers. Short-term interest rates remain well above levels posted earlier this year, although that is mainly about the debt-ceiling issue in the U.S. The Bank’s statement will undoubtedly be rather hawkish.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

We were recently invited to speak on the Vancouver Consumer at Global News CKNW 980 to discuss how you can get the best mortgage rate. Whether you are buying a new home, or have had the same mortgage for years!

If you have 15 minutes, you can listen to the entire segment in the embedded link below, or follow the link HERE.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Canadian Inflation Rose More Than Expected in April, But Core Inflation Slowed

There’s been an unexpected hiccup in the Bank of Canada’s ongoing battle against inflation. Year-over-year, price pressures escalated to 4.4% in April, an uptick from the previous month’s 4.3% and significantly exceeding the average economist’s prediction of 4.1%. This marks the first rise in overall inflation from the last June. Ironically, higher interest rates are intended to tackle inflation, but rising rent prices and mortgage interest costs contributed the most to the all-items CPI increase last month.

This sketches an unusual scenario for the Bank of Canada as it approaches its June 7th rate decision. The economy remains resilient, with Canadians grappling with escalated interest rates and continued price pressures. Spring 2023 increasingly looks like the turnaround point for Canada’s housing market after a year-long slump, and labour markets remained firm in April.

To be sure, inflation is down significantly from the 8.1% year-on-year peak experienced last June. The initial reduction in inflation was swift and relatively straightforward, but predictably, the following phase is proving to be considerably more challenging.

The CPI was up 0.7% in April, following a 0.5% gain in March. Gasoline prices (+6.3%) contributed the most to the headline month-over-month movement. Excluding gasoline, the monthly CPI rose 0.5%. On a seasonally adjusted monthly basis, the CPI rose 0.6%.

Gasoline prices rose 6.3% in April compared with March, the most significant monthly increase since October 2022 and contributing the most to the acceleration in the headline CPI. This increase followed an announcement from OPEC+ (countries from the Organization of Petroleum Exporting Countries Plus) to reduce oil output, pushing prices higher. The switch to summer blend and increased carbon levies also boosted prices.
Nevertheless, gas prices were 7.7% lower in April 2023 compared with April 2022, when prices were higher due in part to Russia’s invasion of Ukraine. Compared with 18 months earlier, gasoline prices were 10.0% higher in April 2023.

Shelter costs rose 4.9% year-over-year in April after a 5.4% increase in March. Canadians continued to pay more in mortgage interest cost in April (+28.5%) compared with April 2022, as more mortgages were initiated or renewed at higher interest rates. The higher interest rate environment may also contribute to rising rents in April 2023 (+6.1%) by stimulating higher rental demand. The year-over-year increase in the homeowners’ replacement cost index slowed for the 12th consecutive month in April (+0.2%) compared with March (+1.7%), reflecting a general cooling of the housing market.

Year over year, prices for groceries rose at a slower rate in April (+9.1%) than in March (+9.7%), with the slowdown stemming from smaller price increases for fresh vegetables and coffee and tea.

Bottom Line

The uptick in April inflation, especially monthly, shows that the road to 2% inflation will be bumpy. Still, the Bank of Canada will be content that their measures of core inflation continue to trend downward (see chart below). The Bank will likely continue the pause in June, but if the May employment numbers continue strong, the Governing Council will indeed warn that they will remain ever vigilant. I do not expect rate cuts this year.

(This article is courtesy of the Sherry Cooper Assoc.)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

According to the Daily Hive average rent for a 1 bedroom apartment is $2541.00 So let me share this with you, did you know?

• That is a 500k mortgage these days? If you want to think about strata and taxes included then shop below that price and invest in yourself
• Parents of teens, does that scare the bejesus out of you wondering how your kids will venture out on their own? – Charge them rent when they get their 1st job $250 – $1k monthly – (They can’t rent below that). Then, when they move out they will have that 5 percent down payment required for that 500k purchase price. Planning makes everything possible!

Reach out to us today and download our app and let’s get you started!

(This article is courtesy of the Daily Hive)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog.