Rising Canadian Housing Starts & Higher Oil Prices Lift the Canadian Dollar

Higher housing starts for the month of March, which were release at 8:15 a.m. EST, pushed the Canadian dollar higher by 0.58 percent on Monday.

Data from the Canadian Mortgage and Housing Corporation (CMHC) showed March housing starts coming in at 211,342.

CMHC Chief Economist Bob Dugan said last month’s housing number is the highest since September of 2007.

While Vancouver housing starts in March were lower for a fourth consecutive month, the actual number of housing starts in the province was at the “highest level on record for March since 1972, driven by new apartment construction.,” according to the CMHC.

The biggest gains were seen in the Toronto real estate market, which showed increases last month in all housing types, with apartment starts showing the biggest trend growth in March:
“Demand for new housing is growing as supply in the rental and resale markets is short, reflected by low rental apartment vacancy rates and declining active listings.”
Although better-than-expected Canadian housing figures pushed USD/CAD exchange rate under 1.3375 on Monday morning, the Canadian currency also received a sizable boost from the rising price of crude oil, which closed at a 33-day high of $53.08 today.

Monday’s crude oil rally pushed the Canadian dollar to finish the day at a 5-day high of 1.33272 against the USD:

CAD banknotes photo by KMR Photography