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www.insideHALTON.com | OAKVILLE BEAVER | Thursday, December 17, 2015 | 34 The Bank of Canada cut interest rates twice in 2015, which drove down borrowing costs and in turn helped to boost housing activity in many markets. Housing has been strongest in Vancouver and Toronto, but certainly not in the rest of the country. We've seen a significant slowdown in Alberta, Saskatchewan and the Atlantic provinces as a result of the steep drop in oil prices since mid-2014. I expect housing activity will slow a bit in Vancouver and Toronto in 2016. It will still be strong, but just not as strong as it was in 2015 in B.C. and Ontario. Where do you see mortgage prices heading? Mortgage rates in Canada are at generational lows. I believe they have now bottomed. The days of falling mortgage rates are over. Instead, I think we'll see a gradual increase in rates, which will lead to a gradual slowdown in housing activity in the coming months, as affordability decreases. Mortgage rates could rise by about a half a percentage point over the next year, to about 3.25 per cent for the average five-year fixed rate term. It's not a huge increase, but given how low rates are, it's a meaningful percentage gain. BC & Ontario poised for Canada's strongest economic growth in 2016 Lower oil prices, alongside a continued slump in mining and metals, has weighted on growth. Oil-dependent provinces such as Alberta, Saskatchewan and Newfoundland and Labrador have seen their economies hardest hit. That includes a drop in housing activity. Meantime, the more diversified economies of Ontario and B.C. are picking up, and housing sales and prices continue to climb rapidly in Toronto and Vancouver. Will this mixed economic and housing picture continue in the months ahead? Dr. Sherry Cooper, chief economist with Dominion Lending Centres, offers her outlook on what Canadians can expect in 2016: huge decline in commodity prices. Alberta's economy slipped into a recession, which has had a big impact on Canada's overall economy, especially given the province had the country's strongest economy for many years. Overall in Canada, we saw a contraction of economic growth in the first half of 2015. Since then, we've seen a modest rebound. I forecast growth to be about 1.2 per cent in 2015. prices has come through in our economy. Some of the economic growth will be driven by increases in government spending, assuming the new Liberal government keeps its promise to add stimulus, and lower taxes for the middle class. The one thing that concerns me is the government's proposed tax increase for high-income earners, which I believe will be counterproductive. Many Canadians have been watching the Canadian dollar lose strength this year. Where do you see it headed in 2016? It's not a great story for the Canadian currency. I think we'll see more downward pressure on the Canadian dollar next year, as a result of a rising American dollar as its economy gains steam and the Federal Reserve hikes interest rates. What's your position on Canada's housing market now and into 2016? Dr. Sherry Cooper Chief Economist for Dominion Lending Centres How would you characterize Canada's economy in 2015? It has been a very tough year, particularly given the What is your forecast for Canada's economy in 2016? We are seeing a continued pickup in some provinces. The growth will likely be strongest in B.C., followed by Ontario. I think overall growth for Canada in 2016 will be around 2.2 per cent. That's not what one would call a rapid expansion. I don't believe the full effect of lower oil 1-888-806-8080 www.dominionlending.ca @DLCCanadaInc /DominionLendingCentresCanada