The Bank of Canada held its overnight policy rate a 2.75 per cent this morning.  In the statement accompanying the decision, the Bank noted US trade policy continues to create uncertainty in the global economy and that uncertainty is likely to slow economic growth in coming quarters. On inflation, the Bank cited stronger than expected inflation in April and survey data showing household inflation expectations rising due to tariffs as concerning trends in the evolution of inflationary pressures.

While we know with a high degree of certainty that trade wars are stagflationary – they slow growth, and raise prices - what we don't know yet is how severe a trade war may be or even if it will end up materializing at all. The immediate impact of that uncertainty is paralysis in decision making, both at the macro level of businesses looking to hire and invest and at the micro level of households thinking of buying or selling a home. Indeed, we are already seeing the impact of uncertainty in a slower labour market and slumping home sales.  Unfortunately, we are also seeing a pick-up in underlying inflation, with core measures of inflation registering above 3% on a 3-month annualized basis in recent months.  That combination of slowing growth and rising inflation puts the Bank in a very difficult position. That said, given rising unemployment and risk of a wider downturn, we believe that the Bank of Canada will, lower its policy rate at least one more time this year, likely at its next meeting July. 

For more information, please contact: Gino Pezzani.

As summer stretches out with its long days and golden evenings, the season gently invites us to slow down. During these quieter moments — the clink of ice in a glass, a passing smile from a neighbor, the hush of a sunset — is when I’m reminded of the beauty in the ordinary.

Lately, I’ve realized that progress often comes not in bold strides but in steady, quiet steps. This season has been teaching me that it’s perfectly okay not to have everything mapped out. Each day offers its own chance to move forward, to learn something new or simply to breathe.

And more than ever, I’m noticing that staying connected is essential. Whether a quick check-in, a kind word or just being present, these simple gestures hold a quiet power. They remind us that we’re not alone in figuring things out and that all of us are navigating life one moment at a time.

There’s no big message here; just a gentle thought: Sometimes the most-meaningful progress occurs when we pause, appreciate where we are and take that next step with intention.

Wishing you calm moments and meaningful connections this summer.

With gratitude,

Gino Pezzani

June is here — longer days, warmer nights and a good excuse to fire up the grill. (Thanks, Dad.)

It’s also when we tip our hats to the father figures who’ve taught us everything from changing a tire to changing our perspective. Their classic one-liners and quiet life lessons stick with us, sometimes more than we care to admit.

This month, let’s celebrate the wisdom, the wit and the welltimed dad jokes that helped shape who we are.

Here’s to the guys who taught us how to do the hard stuff — and laugh along the way. And if you haven’t called him lately, then this is your sign.

To view the full interactive BCREA Commercial Leading Indicator, click here.
To view the full Commercial Leading Indicator PDF, click here.

The BCREA Commercial Leading Indicator (CLI) rose 2 points to 152.6 in the first quarter of 2025, while the six-month moving average rose to 151.1. Compared to the same quarter in 2024, the index was up 3.3 per cent. 

First Quarter Highlights

• The economic activity index rose in Q1 by 0.5 points. Growth in this index was driven by increased inflation-adjusted retail trade (0.2 per cent) and wholesale trade (0.4 per cent), which offset a small decline in manufacturing sales.

• The overall employment component increased by 1.3 points in the first quarter. Broad-based growth across office employment (0.6 per cent) and manufacturing employment (0.7 per cent) suggests a healthy level of job creation across many sectors to begin the year.

• The financial component of the index increased in the first quarter by 0.1 points. Real Estate Investment Trust (REIT) prices rose by 0.6 per cent, slightly pushing the component up. Additionally, interest rate spreads saw modest decreases from the previous quarter, indicating slightly less perceived short-term risk in the economy (this data reflects pre-tariff conditions).

Canadian real GDP rose by 0.1 per cent in March, after declining by 0.2 per cent in February. Goods-producing sectors rose 0.2 per cent, while service-producing industries increased by 0.1 per cent. Sectoral growth was led by mining, quarrying, and oil and gas extraction (2.2 per cent), construction (0.5 per cent), and retail trade (0.8 per cent). Output for the offices of real-estate agents and brokers fell by 4.5 per cent month-over-month. Preliminary estimates suggest that real GDP by industry increased by 0.1 per cent in April.

Real GDP increased by 0.5 per cent in the first quarter of 2025, registering an annualized growth rate of 2.2 per cent. Growth in household spending slowed from the previous quarter to 0.3 per cent, leading to a 0.1 per cent uptick in per capita household expenditures. Growth was driven by increased trade, with exports of goods and services (1.6 per cent) outpacing imports (1.1 per cent). Investment into both residential and non-residential structures declined by 2.8 and 1.6 per cent in the first quarter, respectively. Meanwhile, investment in machinery and equipment increased by 5.3 per cent in the first quarter.  The household savings rate fell from 6.0 per cent to 5.7 per cent in the first quarter, as disposable income growth was outpaced by nominal household expenditures, while investment income declined. On a per capita basis, GDP rose 0.4 per cent in Q1 after increasing by 0.1 per cent in the previous quarter.

Tariff-avoidant behaviour from Canadian households, businesses, and our trading partners alike propelled Canada's GDP growth in the first quarter above the Bank of Canada's most recent projection. Growth in the first quarter was largely driven by rising exports, as US firms and households purchased goods ahead of tariff implementation. As central bankers continue to worry about the economic damage caused by volatile trade policy, this report could influence the Bank of Canada towards a hold during their next meeting to curb the inflationary risks of tariffs. Moving forward, the Bank of Canada will be closely watching second-quarter data for signs of a weakening economy and broader price pressures due to current tariffs and the uncertainty over future trade policy.

For more information regarding British Columbia's GDP growth, please visit our Nowcast for an estimate of economic activity throughout the province:

DRAFT: BCREA Nowcast for March and April Prelim by Economics - Infogram

https://mailchi.mp/bcrea/canadian-economic-growth-real-gdp-q1-2025

For more information, please contact: Gino Pezzani.

June 2025 marks a turning point in how innovation will reshape the way we live, work
and connect.

Emerging trends reveal a future in which technology, sustainability and community
intersect in transformative ways.

1. The Hybrid Work Revolution 2.0

Although remote work is now common, hybrid models are evolving further. According to Gartner Inc.’s 2025 “Hybrid Work Trends Report,” companies are integrating flexible office designs and advanced virtual tools to boost productivity, redefine work-life balance and create a moreadaptable

workforce

2. Ethical AI And Human-Centered Technology

AI is becoming an everyday reality with a strong focus on ethics. World Economic Forum’s 2025 “Ethical AI Report” shows new AI tools — from mental health apps to personalized learning — are being designed with empathy, fairness and transparency, ensuring technology enhances both efficiency and individual well-being.

3. Sustainable Solutions For A Greener Future

Environmental challenges are fueling breakthroughs in sustainable innovation. McKinsey and Company’s 2025 “Sustainability Outlook” notes that advancements in renewable energy, smart urban planning and eco-friendly products are reshaping industries. Startups and established companies are investing in green tech, such as solar infrastructure and biodegradable materials, to reduce carbon footprints and build resilient communities.

4. Blending Digital And Real-World Experiences

AR and VR are merging the digital and physical worlds by transforming tourism, education and local arts. According to the International Data Corp’s 2025 “AR/VR Forecast,” these immersive technologies offer innovative ways to engage with history, nature and creativity, making cultural events more accessible and engaging.

About BCREA’s Housing Monitor Dashboard

The BCREA Economics team has created the Housing Monitor Dashboard to help REALTORS^® monitor BC’s housing market. This dashboard, which is updated monthly, provides up-to-date data on key variables for public education and use. Focuses include: 

• Resale Home Market

• Construction

• Rental Market

• Borrowing Costs

• Other BCREA Data

In the dashboard, the image and data are available for download under each chart, where possible.

For more information, please contact: Gino Pezzani.

Xeriscaping is a sustainable landscaping approach that uses drought-tolerant plants to conserve water while still creating a beautiful outdoor space. The term comes from the Greek word xeros, meaning “dry,” and the practice is designed to minimize the need for irrigation and maintenance.

A key principle of xeriscaping is strategic plant placement. Plants that require more water should be positioned closer to the house; those that can thrive with little or no irrigation can be placed farther away, reducing the need for extra watering.

Many popular perennials fit perfectly into xeriscaped gardens, including hen and chicks, yucca, sedum, yarrow (Coronation Gold and Moonshine), sagebrush and lavender. These plants withstand dry conditions and add color and texture to the landscape.

Container plants and annuals, which, typically, need more water, should be kept near the house and a water source for easy maintenance. To embrace xeriscaping further, you can expand your patio, add stone pathways or replace sections of your lawn with drought-resistant shrubs and plants.

By incorporating xeriscaping principles, you can create a low-maintenance landscape that saves water and enhances the beauty of your outdoor space.

This vibrant salad, perfect for summer BBQs, is packed with fresh, grilled veggies and a zesty lime dressing.

Salad Ingredients:

4 ears of fresh corn, husks removed

1 red bell pepper, diced

1 avocado, diced

1 pint cherry tomatoes, halved

1/2 red onion, thinly sliced

1/4 cup fresh cilantro, roughly chopped

4 cups mixed greens

Optional:Grilled chicken, shrimp, or tofu for extra protein

Zesty Lime Dressing Ingredients:

2 tablespoons olive oil

2 tablespoons lime juice

1 tablespoon apple cider vinegar

1 teaspoon smoked paprika

1/2 teaspoon ground cumin

1 teaspoon honey (or your preferred sweetener)

Salt and pepper, to taste

Instructions:

Preheat your grill to medium-high.Grill the corn on the cob for about 10–12 minutes, turning occasionally, until lightly charred. Once cooled slightly, cut the kernels off the cob into a large mixing bowl.

Prepare The Vegetables:Add the diced red bell pepper, halved cherry tomatoes, thinly sliced red onion and chopped cilantro to the bowl with the corn. Gently fold in the diced avocado.

Make The Dressing:In a small bowl or jar, whisk together the olive oil, lime juice, apple cider vinegar, smoked paprika, cumin and honey. Season with salt and pepper to taste.

Assemble The Salad:Place the mixed greens on a serving platter. Spoon the grilled corn and veggie mixture over the greens. Drizzle the dressing evenly over the salad, toss lightly, if desired, or serve as a layered dish.

Canadian retail sales increased by 0.8 per cent to $69.8 billion in March compared to the previous month. Compared to the same time last year, retail sales were up by 5.6 per cent. Furthermore, core retail sales, which exclude gasoline and automobile items, rose by 0.2 per cent month-over-month. In volume terms, adjusted for rising prices, retail sales increased by 0.9 per cent in March. Retail activity was up 1.2 per cent in the first quarter of 2025, while rising by 0.2 per cent in volume terms.

Retail sales in British Columbia were up 0.3 per cent in March from the previous month and rose by 4.7 per cent compared to the same time last year. In the CMA of Vancouver, retail sales were up 0.7 per cent from the prior month and were 6.4 per cent above the level of March 2024.

March's report marks the fourth consecutive quarterly increase in retail activity across the country. However, this report is unlikely to sway the Bank of Canada regarding its policy rate decision during its next meeting.  As global uncertainties continue casting shadows on the economy, economists will closely monitor next week's GDP report as an indicator of which direction the Bank of Canada will take in June. 

https://mailchi.mp/bcrea/canadian-retail-sales-march-2025

For more information, please contact: Gino Pezzani.