In its latest forecast, CIBC says that the dip, following a rebound in June, will still be in line with the 2016 level and where its economists would expect them to be longer term based on demographic trends.
The bank expects residential construction to be a drag on Canada’s GDP growth by the end of 2017 and for housing starts to slow further in 2018/19 on the impact of interest rate rises and regulatory pressures.
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Canada’s housing starts data is due Wednesday and CIBC Capital Markets is expecting a pace of 198,000 for July.