Morneau: government won't knee-jerk on coronavirus impact

by Steve Randall on 10 Mar 2020

With the spring housing market imminent, many industry professionals are wondering what impact the COVID-19 coronavirus outbreak will have on sales.

The rout on the stock market – the TSX lost $218 billion in market value Monday - and wavering consumer confidence may be offset somewhat by lower mortgage rates helping to maintain demand as buyers consider the long game.

In a press conference Monday, federal finance minister Bill Morneau had a muted response to questions about economic stimulus.

“We’re looking at a series of measures that are appropriate for different fact patterns. You will see us move forward as we see those facts on the ground,” he said.

Canada’s oil producing provinces are likely to feel the impact as prices tumble on expectation of weakened demand. For many regions this new challenge comes as they are still trying to shake off the effects of the previous price slump in 2014.

With confidence fading, calls for a global recession are growing, but Morneau highlighted that Canada’s economy is starting from a point of strength relative to its G7 peers.

Following the cut in interest rates last week, the forthcoming budget could be the next time that the housing market – and the wider economy – is handed some help.

But don’t count on it.

“We shouldn’t think of the budget as the only way to respond,” said Morneau, adding that the government will respond “appropriately” as the economy develops.

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