German President Koehler Quits
German President Horst Koehler says he is resigning immediately, following criticism of remarks he made about German military deployments abroad. He said that for an export-orientated country like Germany, it was sometimes necessary to deploy troops "to protect our interests... for example free trade routes".
Nearly 20% of Homes Overvalued
Seventeen percent of Canadian homes are overvalued, CIBC warned Tuesday, with a 5 to 10 percent price correction likely to hit in the next two years.With higher interest rates likely to make housing less affordable in the coming years and the market beginning to show signs of cooling, prices are "probably" going to fall back as homeowners are increasingly cautious about how they spend their money."The most likely scenario is that higher interest rates will lead to a modest decline in prices in the coming year or two," economist Ben Tal wrote in a report.
Accountants Worry About Debt Loads
A new report by the Certified General Accountants Association of Canada shows that household debt in the country kept rising through the recession and peaked in December at $1.41 trillion. That's $41,740 on average per Canadian, or debt to income ratio of 144 per cent, which is the worst among 20 advanced countries in the Organization for Economic Co-operation and Development.
Shopping till we drop?
Canadian homebuyers are spending beyond their limits and a looming increase in interest rates will likely leave many consumers stretched thin, according to a new report by Canadian Imperial Bank of Commerce."After this wave of borrowing, which culminated this spring, we will have a consumer that is much more vulnerable to higher interest rates," said CIBC economist Benjamin Tal.
Dollar Closes Above Par
The Canadian dollar Wednesday closed above parity with the U.S. currency for the first time in 22 months, since July 28, 2008. The loonie finished up .27 of a cent at 100.08 cents US.
