Highlights of the Week – October 24

United States
• Equity markets continued their winning streak this week. The economic data was generally supportive of the cheerful mood, with the Empire and Philly Fed indices both posting better-than-expected improvements in October.
• Next week’s GDP data is likely to confirm solid growth in Q3, if somewhat dented by Hurricane disruptions. That is consistent with the picture painted by this week’s Beige Book.
• There are plenty of potential policy-related moves afoot for markets to speculate on. A Fed Chair appointment is imminent, and GOP tax reform efforts crossed another milestone this week.

Canada
• Manufacturing and retail sales moved in opposite directions in August, with factory shipments up 1.6% while retail sales slid 0.3%. Headline inflation was up by 1.6 y/y in September, (from 1.4% y/y). Core inflation was relatively unchanged.
• The Business Outlook Survey showed that sentiment pulled back in the third quarter, but remains positive, consistent with a solid pace of economic growth.
• OFSI released revised “B-20” guidelines for residential mortgage underwriting at federally regulated financial institutions this week, extending the ‘stress test’ to all borrowers rather than just those requiring mortgage insurance and those with terms of less than five years. This is likely to pour more cold water on an already cooling housing market.

For further information, please contact:

John Maveety Manager, Residential Mortgages – Greater Ottawa Area TD Canada Trust
T: (613) 371-1984 F: (888) 899-1984 P: (866) 767-5446
John.Maveety@td.com