According to ActionForex, analysts at TD Bank Financial Group note that the Canadian housing data continues to defy expectations.

"Canadian housing starts jumped to 245.6k (annualized) units in July, up from 212.1k units in June. Stripping away monthly noise, the 6-month moving average increased to 204.4k units, up from 199.8k units in June. The release came in above consensus expectations of a modest pullback to 205k units in July."

"July’s increase was driven primarily by the multi-starts category, where urban starts were up 18.8% m/m to 184.4k units. Urban single-detached starts increased 12.3% to 47.6k units."

"The strength in homebuilding was widespread across all regions, but was, surprisingly, led by the Prairies and Atlantic Canada."

"July’s print reinforces the resilience of homebuilding activity (and housing market activity more broadly) despite the unprecedented, pandemic-induced hit to the economy. Indeed, aside from the complete pause in Quebec in April due to restrictions on non-essential economic activity, homebuilding has shown only a muted response to COVID-19, swiftly returning to pre-pandemic levels. This stands in contrast with more severe declines and more drawn-out recoveries seen in other industries."

"Strong housing demand continues to drive this resilience, supported in part by the impacts of past increases in population growth and demand more broadly, as well as historically low borrowing rates. These forces should continue to support housing activity in the near term."