U.S. Federal Reserve Chairman Ben Bernanke, European
Central Bank President Jean-Claude Trichet, and former
central bank officials and head economists all met in Jackson Hole,
Wyoming over the weekend, one year after the start of the financial
crisis that has led to more than $500 billion in losses and writedowns,
to discuss how to prevent such a collapse from reoccurring.
Economists, strategists and traders do not expect next week’s releases
to shed any new light on the current economic environment. Markets will
receive more data on the U.S. housing market, July’s
durable goods orders, PCE report, and minutes from the FOMC Aug. 5
meeting. In Canada the only data of significance will be Q2 GDP.
U.S. existing home sales rose more than expected to
5.00 million units in July, a 3.1% gain in the month, following June’s
revised sales figure of 4.85 million. With that gain the index rebounded
to the highest level in five months, although the range in the past 11
months has been relatively narrow, according to the National Association
of Realtors (NAR).
Economists say the larger-than-expected rise in July
existing home sales doesn’t necessarily point towards stabilization,
since more than a third of the sales are related to foreclosures. They
also note that a record high inventory level will put downward pressure
on prices going forward.
In an interview with the New York Times, Philadelphia Fed
President Charles Plosser said he might consider dissenting in
favour of raising interest rates to fight inflation and maintain the
Fed’s credibility.
The U.S. economy continues to be in recession and will continue to be
for some time, according to billionaire investor Warren
Buffet.
Markets will be interested to hear what Federal Reserve
Chairman Ben Bernanke has to say about the current economic
climate. Bernanke will be in Jackson Hole, Wyoming, speaking about
financial stability. There will be no macroeconomic data coming out of
Canada.
Following the early-morning release of Canadian CPI, markets will now
turn their attention to the release of U.S. initial and continuing
jobless claims and the Philly Fed
survey for August.
Initial claims for unemployment benefits in the
United States dropped back slightly to 432k in the week ending Aug. 16,
coming down 13k from the previous week’s downwardly revised 445k figure,
the Department of Labor reported on Thursday. Continuing claims fell to
3.362 million for the week ending Aug. 9.
Markets are currently pricing in the following probabilities for
future interest rate moves as of the close on Wednesday:
ST. THOMAS, Ontario, August 18, 2008 — The Government of Canada, the Government of Ontario, and the City of St. Thomas today celebrated the opening of 23 new affordable rental units. This project is supported by over $1.5 million in funding through the Canada – Ontario Affordable Housing Program.
LANTZVILLE, British Columbia, August 20, 2008 — Nanoose First Nation celebrated the grand opening of 30 new, single family homes today. Chief David Bob and Elders Ann and Jim Bob were joined by community and guests to officially open the area’s largest new housing project. More than 30 band members, including Elders and their families, will move into brand new, energy-efficient …
LONDON, Ontario, August 14, 2008 — The Government of Canada, the Government of Ontario, and the City of London today celebrated the start of construction for 78 new affordable rental units in two London projects. These projects are supported by over $5 million in funding through the Canada – Ontario Affordable Housing …
OTTAWA, Ontario, August 15, 2008 — New home construction will begin to slow in 2008, but will remain high by historical standards, according to Canada Mortgage and Housing Corporation’s (CMHC) third quarter Housing Market Outlook, Canada Edition report.
PETERBOROUGH, Ontario, August 15, 2008 — The Government of Canada, the Government of Ontario and the City of Peterborough today celebrated the opening of a new affordable housing project supported by over $1.7 million in funding under the Canada – Ontario Affordable Housing Program.
While the U.S is currently in the midst of the largest bout of home
foreclosures in at least 30 years, at least one economist says
two more ‘waves’ are likely on the way.
Federal Reserve Bank of Minneapolis President Gary Stern said
Wednesday that now is not an “appropriate time” to close
government-sponsored Enterprises Fannie Mae and Freddie Mac.
Canadian retail sales followed by the U.S. Department of Energy’s
weekly oil inventories will hold the focus of Wednesday’s news releases
on what is shaping up to be a mild day of economic news for North
America. At midday, markets will also be paying attention to the Bank of
Canada selling C$3.6 billion in two-year notes.
A leading indicator for the U.S. commercial real estate
market continued decelerating for the fourth consecutive quarter
on Wednesday, according to the National Association of
Realtors, who also said that commercial real estate activity
would weaken over the next six to nine months.
Mortgage interest rates for the week ended August 14
as reported from data collected by Freddie Mac from its Primary Mortgage
Market Survey drifted in a very narrow range as they have done for most
of 2008.