{"id":12953,"date":"2015-10-03T08:46:42","date_gmt":"2015-10-03T13:46:42","guid":{"rendered":"http:\/\/olduvai.ca\/?p=12953"},"modified":"2015-10-03T08:46:42","modified_gmt":"2015-10-03T13:46:42","slug":"u-s-jobs-and-global-gloom-may-mean-more-mortgage-relief-don-pittis","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=12953","title":{"rendered":"U.S. jobs and global gloom may mean more mortgage relief: Don Pittis"},"content":{"rendered":"<div class=\"story-headline\">\n<h3 class=\"story-title\"><a href=\"http:\/\/www.cbc.ca\/news\/business\/u-s-jobs-interest-rates-economic-analysis-1.3254426\" target=\"_blank\">U.S. jobs and global gloom may mean more mortgage relief: Don Pittis<\/a><\/h3>\n<\/div>\n<p class=\"story-deck\"><strong>Interest rate hikes fade into the future as economic recovery appears to go flat<\/strong><\/p>\n<p>It seems a terrible thing to cheer about, but a new feeling of gloom may be good for Canadians weighed down by mortgage debt.<\/p>\n<p>A\u00a0<a href=\"http:\/\/www.cbc.ca\/news\/business\/us-jobs-september-1.3253841\">worse-than-expected U.S. jobs report<\/a>\u00a0and increasing\u00a0fears for the state of developing world economies mean that U.S. central banker\u00a0Janet Yellen may have to once again delay a hike in\u00a0interest rates.<\/p>\n<ul>\n<li><strong><a href=\"http:\/\/www.cbc.ca\/news\/business\/us-jobs-september-1.3253841\">U.S. creates 142,000\u00a0jobs as hiring slows<\/a>\u00a0<\/strong><\/li>\n<li><strong><a href=\"http:\/\/www.cbc.ca\/news\/business\/house-prices-may-stay-high-in-canada-here-s-why-1.3095421\">House prices may stay high in Canada. Here&#8217;s why<\/a><\/strong><\/li>\n<\/ul>\n<p>Fed chair Yellen has repeatedly warned that U.S. interest rates are on the way up. Last month, she delayed that\u00a0rate rise once again while suggesting the increase could very likely come by the end of this year.<\/p>\n<p>Now a growing number of analysts say a hike in U.S. interest rates will be delayed to 2016 or beyond.<\/p>\n<p><strong>Why U.S. rates matter in Canada<\/strong><\/p>\n<p>Before going on, I should insert a quick reminder of why U.S. interest rates matter to so many\u00a0Canadian mortgage holders.<\/p>\n<p>While\u00a0short-term rates are set by the Bank of Canada, mortgage rates depend on the cost of borrowing money on international bond markets. Before lending long-term cash, Canadian banks like to make sure they can spread the load if rates begin to rise. That means they look to the bond market to set the price of\u00a0the long-term cash they lend.<\/p>\n<p>When the U.S. Fed rates\u00a0begin to rise, international bond rates begin to rise as well, and banks must pass along those increased interest interest\u00a0costs to\u00a0their customers.<\/p>\n<p>As recently as June, Yellen foresaw not just an autumn rate rise, but her advisers on the Federal Open Markets Committee also suggested that rates would continue to rise at about a whole percentage point each year. In other words,\u00a0long-term rates that were four per cent this year would be five per cent next\u00a0and six per cent the year after.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>U.S. jobs and global gloom may mean more mortgage relief: Don Pittis Interest rate hikes fade into the future as economic recovery appears to go flat It seems a terrible thing to cheer about, but a new feeling of gloom may be good for Canadians weighed down by mortgage debt. A\u00a0worse-than-expected U.S. jobs report\u00a0and increasing\u00a0fears [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[942,103,3544,3000,4936,303,305,1154,431,451,8707],"class_list":["post-12953","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bank-of-canada","tag-canada","tag-cbc","tag-cbc-news","tag-don-pittis","tag-fed","tag-federal-reserve","tag-interest-rate-policy","tag-interest-rates","tag-janet-yellen","tag-us-fed"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12953","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12953"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12953\/revisions"}],"predecessor-version":[{"id":12954,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12953\/revisions\/12954"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12953"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12953"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12953"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}