March 18 briefing: fiscal stimulus package announced
Government pledges billions in support of Canadian workers and businesses
The Prime Minister addressed the nation for a third consecutive day. Today’s comments included an announcement of a major fiscal stimulus package designed to provide financial assurances to those citizens and businesses being directly impacted the covid-19 pandemic.
- Up to $27 Billion in direct support for Canadian workers and businesses.
Employment Insurance highlights
- Emergency care benefits for those who need to stay home due to illness
- Emergency support benefits for those not regularly eligible for EI
Business support highlights
- Temporary withholding tax subsidy of 10% for small businesses employers, up to $25,000.
- Tax filing deadline for individuals extended until June 1
- New tax payments owing deferred until Aug 1
- Boosting the GST credit and Canada Child Benefit payments
- Moratorium on student loan repayments
- Boosting funding for First Nations communities, persons experiencing homelessness, and women and children fleeing violence
Much of this plan will need to be to enacted by Parliament, with an expectation that payments could begin to arrive in early April.
Additional updates impacting the banking and lending sector
CMHC will be purchasing up to $50 Billion of insured mortgage pools. This is expected to significantly aid lender liquidity.
CMHC will also be permitting lenders to allow mortgage payment deferrals. Canada’s 6 largest banks have stated that they will be working with clients on a case-by-case basis to determine deferral solutions.
Interest rates and the bond market continue to experience volatility, and despite extensive measures designed to boost liquidity, there continues to be upwards pressure on Canadian mortgage rates at this time.