Tit For Tariff Policies Weigh Heavy By Design

2025-03-05 15:20:00 ET

Summary

• Economic conditions today are more fragile than in March 2018.
• The median US home sale price rose 40.7% from $317,200 in January 2019 to $446,300 today, while the average 30-year fixed mortgage rate rose from 3.68% to 6.87%.
• The BoC estimates that real Canadian GDP under a 25% tariff scenario will be a deeply recessionary 4% lower than otherwise.
• Without falling demand and higher unemployment, the cost of living is unlikely to decline enough for the Fed to lower short-term policy rates and, more importantly, for the bond market to lower longer-term fixed borrowing rates.

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