Housing activity has also been stronger than expected. While we have incorporated some of this strength in a higher profile for residential investment, we still anticipate slowing over the projection horizon. The current pace of activity in the Greater Toronto Area (GTA) and parts of the Golden Horseshoe region is unlikely to be sustainable, given fundamentals.
House price growth in the GTA has accelerated sharply in recent months, suggesting that speculative forces are at work. In terms of the labour market, recent data have been mixed. While job growth has certainly been firm, both wages and unit labour costs have grown only slowly.