IMF Says Canada May Need New Restrictions on Housing Marketby
Canada may need new measures to curb a housing market boom after a surge in Vancouver and Toronto prices, a challenge to policy makers seeking to boost an economy hurt by a slump in crude oil prices, the International Monetary Fund said.
“The weaker economy has reignited concerns about the elevated level of household debt and divergent trends in house prices, which are rapidly rising in Vancouver and Toronto and falling in Alberta,” the Washington-based group estimated Monday in its annual “Article IV” review. “Macroprudential policy can be further tightened if imbalances in the housing market threaten to intensify.”
The Bank of Canada should “maintain an accommodative monetary stance” and additional fiscal easing should be considered if risks materialize,” the IMF report said. Canada’s economy is on track for a gradual economic recovery, the report from the IMF’s executives said.