BMO Sees Canadian Rates Rising Above 4% If Housing Finds a Floor

The Bank of Canada may need to drive interest rates above 4% partly because the housing market is “showing a flicker of life,” according to the Bank of Montreal.

Chief Economist Douglas Porter’s tentative prediction came after Toronto home sales bounced 11% in August from the previous month. While benchmark prices continue to drop, the jump in activity could be a sign the market slide is easing even amid rising interest rates and an uncertain economic outlook.