A Popular Indicator Flashes Red

Also in this edition:
• Capitalizing on consumer mortgage trends
• Mortgage Bytes

If we had a chart of the week, it would be this one.

Citigroup's U.S. economic surprise index (chart above) has turned negative for the first time in well over a year. A reading below zero means the U.S. economy is in worse shape than expected. Surprise index readings start falling fast when America's economy declines, and the last few weeks have seen a steep drop.

For Canadians eyeing mortgage rates, this matters—because when Uncle Sam sneezes, we reach for the tissues. Some like to think we control our own destiny north of the 49th. But the truth is, the overstimulated U.S. economy must decelerate to give Canadians a fighting chance at 3-handle mortgage rates.

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