Bank of Canada
Indicators of Capacity and Inflation Pressures for Canada
Updated: 19 October 2006 Page 3 Next release: 7 December 2006
Real estate market (year-over-year percentage change)
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2004Q4 2005Q1 2005Q2 2005Q3 2005Q4 2006Q1 2006Q2 2006Q3 2006Q4 Latest data
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New-housing
price index 5.4 5.1 4.7 4.7 5.6 7.0 9.1 12.1Aug
Resale-housing
prices: Royal
Lepage 5.7 6.2 6.6 6.8 7.3 8.3 9.6 9.6Q2
Vacancy rate
apartments (%) 2.7 2.7 2.7Oct
offices (%) 10.6 10.3 9.5 8.9 8.2 7.4 7.1 7.1Q2
industrial
market (%) 4.9 4.5 4.5 4.6 4.4 4.3 4.3 4.3Q2
Expectations (year-over-year percentage change)
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2004Q4 2005Q1 2005Q2 2005Q3 2005Q4 2006Q1 2006Q2 2006Q3 2006Q4 Latest data
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Business Confidence Survey (Conference Board)
% of firms expecting price increases over the next six
months of:
1% or less 14 22 10 7 8 9 13 13 13Q3
2% or less 74 57 65 37 49 52 58 63 63Q3
3% or less 96 92 93 84 88 95 93 95 95Q3
more than 3% 4 7 5 16 12 4 5 5 5Q3
CPI inflation: Consensus Forecasts
2006 1.9 1.9 2.1 2.3 2.0 2.0 2.1 2.2Sep
2007 1.8 1.8 1.8 1.9Sep
2-3 years 1.9 1.9 2.0 2.0 2.0Apr
6-10 years 2.0 2.0 2.0 2.0 2.0Apr
Bank of Canada Regional Office Survey
% of firms expecting CPI inflation over
the next two years to be:
less than 1% 0 0 1 0 0 2 0 0 0Q3
1-2% 29 33 18 10 14 15 15 15 15Q3
2-3% 56 60 68 60 61 63 61 63 63Q3
more than 3% 12 4 7 27 19 18 22 20 20Q3
Expectations implicit in
real/nominal
bond spread 2.7 2.7 2.6 2.4 2.6 2.7 2.7 2.6 2.4 2.4Oct
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