Today's Report (01/05/2022)

The total value of building permits increased 6.8% to $11.2 billion in November. Seven provinces, led by Alberta (+20.6%) reported increases. Construction intentions in the residential sector rose 12.0% while the non-residential sector declined 3.4%. On a constant dollar basis (2012=100) building permits increased 6.3% to $7.6 billion.

Construction intentions for the residential sector increased 12.0% to $7.8 billion at the national level, reaching the highest level since the record set in March 2021.

The value of institutional permits fell 49.2% in November to $613 million, reversing October's strong growth. This was the lowest level for institutional permits since April 2020.

What It Is?

Measures the change in the number of new building permits issued by the Govt.

What Are The Fundamental Effects?

It is a key indicator of demand in the housing market. By tracking the issuance of permits, we can get a sense of how much and where future construction will take place.

How Does It Affect The Markets?

CURRENCY - A higher than expected reading should be taken as bullish for the Canadian Dollar, while a lower than expected reading should be taken as bearish for the Canadian Dollar.

STOCKS - A vibrant housing market is often seen as positive for shareholders If the housing markets start to surge when the rest of the economy is at full speed.

BONDS - A pick-up in permit issuance is often bad news for fixed income markets because a healthy housing market depicts a robust economy and inflation pressures are likely to accelerate.