Monday Market Minute | Nov 4, 2019

Post-election fiscal policy takes shape — infrastructure and housing prioritized

What Moved

The Trudeau government's post-election mandate letters to ministers confirmed infrastructure spending acceleration and housing affordability as top fiscal priorities. The Infrastructure Minister was tasked with accelerating the $180 billion Investing in Canada plan, while the Housing Minister received direction to expand the First-Time Home Buyer Incentive and increase CMHC's mandate for affordable housing. The Canada Infrastructure Bank was directed to deploy capital more aggressively.

Why It Matters

Government priorities aligned directly with private market opportunity. Infrastructure spending required private capital co-investment through P3 structures, creating deployment opportunities for infrastructure debt and equity funds. Housing policy support — particularly the First-Time Home Buyer Incentive — would stimulate demand at the entry level, supporting the broader market and improving conditions for MICs and development lenders. The fiscal direction was unambiguously supportive for real estate and infrastructure private markets.

Signal to Watch

The pace of Canada Infrastructure Bank deal closings would indicate whether the government's infrastructure ambitions were translating into investable opportunities. The CIB had been criticized for slow deployment since its 2017 creation — accelerated activity would mark a meaningful shift.

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