Canadian building permits fall in June on lower construction intentions for residential buildings

Canada’s building permits dropped sequentially in June. According to Statistics Canada, Canadian municipalities issued CAD 8.1 billion worth of building permits, down 2.3 percent from May’s. The fall was driven by lower construction intentions for residential buildings, following a solid May. Most of the decline was mainly due to multi-family dwellings.

Within the residential sector, municipalities issued CAD 5.2 billion worth of permits in the month, down 5.7 percent sequentially. The value of multi-family dwelling permits fell 8 percent to CAD 2.8 billion in June. The value of single-family dwelling permits dropped 2.9 percent to CAD 2.4 billion. Meanwhile, municipalities approved the construction of 19,111 new dwellings in June, a fall of 10.5 percent sequentially. The fall was mainly linked to a 14.3 percent fall in multi-family dwellings, to 13,667 new units. The number of new single-family dwellings rose 0.8 percent to 5,444 new units.

Within non-residential sector, the value of building permits rose 4.6 percent in June to CAD 2.9 billion. Rises in Alberta and Ontario more than counted the falls in six provinces. In the institutional component, the total value of permits rose 16.3 percent to CAD 609 million. This gain followed four straight monthly falls. Eight provinces recorded rises, led by Ontario and Newfoundland and Labrador.

Province wise, the total value of building permits fell in six provinces in the month, with the biggest fall seen in Quebec. In the meantime, construction intentions dropped in 20 out of 36 census metropolitan areas.

In the second quarter, the value of permits dropped 1.9 percent to CAD 24.3 billion, after a 2.4 percent rise in the first quarter. In spite of the fall in the second quarter, the year-to-date value was CAD 2 billion higher than the value of the first two quarters of 2017. In the residential sector, the value of permits fell 0.3 percent to CAD 15.8 billion. A rise in the value of permits for multi-family dwellings almost countered a fall from the single-family dwelling component. In the non-residential sector, falls in the institutional and industrial components added a 4.6 percent drop in the second quarter, while the commercial component rose slightly.

At 17:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was highly bearish at -133.9, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at -35.8942. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex