The number of permits issued for the start of construction in Canada rose sharply in June, trouncing pessimistic market forecasts. The figure came in with a 20.9% rise, month-on-month; well beyond the expected 5.1% growth. The news is a clear sign that Canadians are seeking to invest in capital projects, likely to drive the value of real estate higher in the coming months.
So far, the Canadian dollar (CAD) has seen only mild growth, muted by a return of risk aversion this week. A decline in oil prices has also created some bearish pull on the Loonie, preventing the northern giant from profit from its bullish capital growth. Should we witness an investment flow into the housing market in Canada, the CAD could see some booming strength later in the year.
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