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Canada’s Mortgage Clampdown Means Economic Pain Now, Gain Later

  • Finance Minister Bill Morneau unveiled new measures last week
  • Moves to cool house-price appreciation to weigh on GDP growth

Canadian Prime Minister Justin Trudeau’s Liberal government is taking a little bit of economic pain now to prevent a much bigger problem down the road.

Real estate measures introduced by Finance Minister Bill Morneau last week will probably cool the housing market, reducing its contribution to already tepid gross domestic product growth, analysts say. That may be a small price to pay to lessen the odds of a real-estate crash in Toronto or Vancouver.