Canada Should Signal Rate Increase to Cool Lending, BofA SaysBy
Canada’s low interest rates are feeding risky behavior in financial markets and central bank policy makers should cool things off by signaling they will tighten, according to Bank of America Corp.
The credit downgrade of six Canadian banks and troubles at mortgage lender Home Capital Group Inc. are reigniting concern the nation’s housing market is a bubble in danger of bursting, and central bank interest rates remaining too low for too long heighten the risk of a financial crisis, Carlos Capistran, an economist in New York at Bank of America, wrote in a research report…
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