📊 What the Economic Experts Are Saying—A Shift in Canada’s Economic Momentum?

With Insights on the Canada/USA Relationship from a Powerful Lineup of Economists: Poloz, Rabidoux & More.

At a recent industry conference featuring Stephen Poloz (former Governor of the Bank of Canada) and housing expert Ben Rabidoux, we got a clearer picture of what’s happening in the Canadian and U.S. economies—and where we may be headed. If you're navigating the housing market or planning a refinance, here’s what you need to know.

🇨🇦 Canada: Optimism, Opportunity, and a Potential Economic Renaissance

Stephen Poloz sees cause for cautious optimism. Canada’s new government is signaling bold plans—boosting business investment, upgrading infrastructure, and removing trade barriers between provinces. There’s even talk of positioning Canada as a global energy superpower.

If even half of this policy direction comes to fruition, it could be very bullish for the Canadian dollar, which has been underperforming for years. With stronger fundamentals, Canada may finally step into a long-awaited economic comeback.

🇺🇸 U.S. Recession Risk Remains High

In contrast, the U.S. outlook is murkier. The combination of structural inflation risks, tariffs, and deteriorating fiscal policies could lead to long-term weakness in the U.S. dollar. Poloz suggests that the reputational and economic damage to the U.S. is already significant—and difficult to reverse under current leadership.

Rabidoux estimates there’s now a 40% chance the U.S. enters a recession this year, which would make it harder for Canada to maintain growth momentum.

📉 Canadian Consumer & Business Confidence at Record Lows

Back home, Canadian business and consumer confidence plunged to record lows this past March—even lower than during COVID or the 2008 financial crisis. This has translated into:

• A sharp slowdown in big-ticket consumer purchases

• Hesitation among businesses to hire or invest

• Two consecutive months of declining job numbers

• The largest non-strike-related job drop since 2009

  
  

While confidence is showing minor improvement, these trends point to real economic stress, especially as Canadians continue facing decade-high rates of delinquencies on credit cards, car loans, and personal loans.

🏦 Relief Ahead? Bank of Canada Rate Cuts Expected

The good news? The Bank of Canada may be preparing to cut interest rates as early as June, with a 60% chance of a 0.25% cut—and potentially more to follow.

If that happens (and banks compete aggressively for renewals), we could see fixed mortgage rates drop into the low 3% range by fall.

🏡 Housing Market Outlook: Pent-Up Demand Is Building

Home sales bottomed in Q1, and affordability—while still a challenge—is improving. Rabidoux noted:

• Sales are at their lowest per-capita levels since the 1990s

• Ontario would need a “brutal recession” to fall further

• If rates are cut again, affordability will mirror 2021 levels, when sales were 50% higher

  
  

✅ Takeaway: Watch for Opportunity, Not Just Risk

While economic uncertainty remains, especially linked to U.S. conditions, Canada is showing early signs of recovery—particularly if planned policies take root. For borrowers, lower rates could be on the horizon. And for investors, a stronger Canadian dollar and rising confidence could shift the landscape sooner than expected.

If you’re unsure how to time your next move, whether refinancing or buying, I’m here to help you make sense of it all—with strategy, not stress.

📩 Send me a message or book a time to chat here.

—Melissa 💙

Melissa Kuczepa, AMPC, Mortgage Agent Level 2

(905) 925-4762

melissa@mkmortgagesolutions.com

Mortgage Architects #12728