Today's Report (11/02/2021)

The total value of building permits rose 4.3% to $10.1 billion in September, led by Ontario (+6.3%). Construction intentions in the residential sector were up 8.2%, while the non-residential sector decreased 3.2%.

The total value of building permits saw a second quarterly decline, down 3.8% to $29.8 billion in the third quarter compared with the previous quarter. However, building permits were 14.3% higher compared with the third quarter of 2020.

The value of residential building permits fell 5.4% to $20.2 billion in the third quarter of 2021, with declines in both single-family and multi-family dwellings. In contrast, on a year-over-year basis, the residential sector was up 16.5%. Construction intentions for the non-residential sector edged down 0.2% to $9.6 billion compared with the second quarter. Industrial building permits rose 33.8%, helped by large projects such as the Calgary International Airport'sAirside Maintenance Centre expansion and a wind turbine blade manufacturing plant in Quebec. However, declines
in the commercial (-3.2%) and institutional (-14.4%) components pulled the sector down overall for the quarter.

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.