BOC’s Gravelle: The risk of a wave of consumer defaults seems low
|The Bank of Canada (BOC) Deputy Governor Toni Gravelle downplayed the risks of a consumer default wave, in remarks via video conference to the Autorite des marches financiers, adding that the impact of the coronavirus pandemic has not yet materialized.
Further comments (via Bloomberg)
“We have long warned that a recession could create broad stress across the financial system.”
“Yet, despite the devastating economic impact of the pandemic, this risk has not -- as of yet -- materialized.”
“To this point, we do not see signs that home prices are rising due to speculation like we saw in the greater Toronto and Vancouver areas a few years ago.”
Cautioned about “the need to be vigilant in certain segments of the market such as condos.”
“Staff will be conducting simulations using firm-level data to quantify this, and we plan to publish those results in the next couple of months.”
USD/CAD consolidates below 1.3100
USD/CAD showed little reaction on the above comments, as it keeps its consolidative mode intact around 1.3080 following Monday’s rally to two-day highs of 1.3113 on broad-based US dollar strength.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.