Bankers Doing Bond Deals Caught Out by New Era of Issuer Clauses
Message to bond underwriters: Some big customers are sizing up your ESG credentials.
Latest Videos
The information you requested is not available at this time, please check back again soon.
Message to bond underwriters: Some big customers are sizing up your ESG credentials.
Joe Biden’s allies are racing to blunt the presidential campaign of Robert F. Kennedy Jr., casting his third-party effort as a stalking-horse bid designed to boost Donald Trump’s chances — even as his wide-ranging policy positions make him a threat to both.
Chengdu, a major city in the southwest China, removed home-buying curbs, joining dozens of peers in the country in an attempt to revive real estate demand and boost economic growth.
China Vanke Co. made a rare response to Moody’s downgrade last week, citing support from financial institutions and its biggest shareholder.
Billionaires who built their fortunes rolling out wireless networks when debt cost almost nothing are seeing their wealth crimped by higher borrowing costs and caution among money managers on the outlook for the industry.
Mar 30, 2021
BNN Bloomberg
,BMO Economics is adding its voice to the concerns being raised on how policymakers need to act immediately to cool Canada’s hot housing market, urging they break the market psychology that has caused home prices across the country to soar.
“The reality is we’ve gotten to a point now where it looks like the expectations of price gains are fueling more speculative activity and the fear of just simply missing out on the market altogether is pulling demand forward and making things even more exaggerated at this point,” said Robert Kavcic, senior economist at BMO Capital Markets, in an interview.
Kavcic said a recent survey from the Mortgage Professionals Canada showed expectations for housing prices were the highest in roughly a decade, with record low mortgage rates and the expectation those rates will continue to stay low deemed to be the largest contributing factor to rising home prices.
“A lot of that is anchored just by the fact that interest rate expectations are similarly low and more or less not expected to move for at least a couple of years,” he said.
These expectations were encouraged by the tone set by the Bank of Canada, after Governor Tiff Macklem signalled that interest rates could remain at its lower bound of 0.25 per cent until at least 2023.
The BMO Economics report detailed what other policy measures could be taken and rated them based on impact, complexity, and spillover effects. Changes to the Bank of Canada interest rate would be a highly effective solution, though it could have repercussions for the broader economy in segments that rely on accommodative borrowing conditions during the pandemic, the report said.
Another measure the report described is a controversial one: a potential capital gains or speculation tax, something that other Bay Street economists have highlighted. According to the report, a similar measure took place in Ontario during the 1970’s, the result of which weakened the market overnight.
“It very quickly, overnight, changed the psychology among domestic investors here in Canada that we might be in for a period where home prices struggle a bit and a lot of those investors did pull back just simply by seeing that policy come into the market, even though it didn’t necessarily impact them directly in the pocketbook,” Kavcic explained.
BMO expects this measure would deter home flipping and make some investment properties less attractive over the long term. But Kavcic pointed out that if policymakers consider the measure, it should be minimize any impact it could have in investing in rental properties.