35,000 decisions. That’s how many decisions the typical Canadian adult makes in a day. And those decisions start from the moment we wake up. Coffee or tea? That’s a decision. Cereal or toast? That’s another one.
As the day progresses, the decisions that we make have a tendency to become increasingly complex and confusing. So much so, that – you’ve guessed it – the experts have come up with a phrase to describe it: decision fatigue.
Decision fatigue, refers to the weakening quality of decisions made by an individual after a long session of decision making. It is most commonly associated with irrational tradeoffs. This helps explain why ordinarily sensible people get angry at colleagues and families, splurge on clothes, buy junk food at the supermarket and can’t resist the dealer’s offer to rustproof their new car.
The Canadian housing market continues to soften and the process is not over yet. The gravitational forces generated from the unsustainable surge in the Vancouver market in 2015 and in Toronto in 2016 and early 2017 are fading away, but the impact of OSFI’s B20 quali cation rules is now in full force.
Mortgages outstanding have slowed down to a year-over-year rate of 4.9%—the slowest pace since mid-2014. A growing number of buyers are finding it more difficult to close a transaction under the new rules, while some are being forced to find alternative sources of funding. New-home builders are starting to delay new projects, and from what we are hearing, the main damage to housing starts will be felt next year.
We at CIBC Economics try to be one-handed economists—with not too many buts and howevers. BUT, when it comes to the near- term trajectory of the US dollar, it appears that what you need is an octopus economist. You see, currencies have a mind of their own, and trying to predict them is an intense exercise in frustration.
The consensus on the street is that the trade-weighted dollar will lose ground over the coming year. The logic here is that the Fed’s future trajectory is fully priced in, and with some potential tightening coming from Japan and the Eurozone, the greenback will look less attractive.