Despite a healthy report from Statistics Canada on the 2002 housing market for 2002, most analysts expect the Bank of Canada to keep interest rates at their present level. The bank is announcing its latest rate decision tomorrow.

Statistics Canada reported Monday that the total value of investment in the housing sector “soared to a new high of $52.7 billion in 2002, up a remarkable 20.9% from 2001. With its sustained activity levels, residential construction was a mainstay of the economy in 2002.” All three components of residential construction investment — new housing, renovations and acquisition costs — posted gains from 2001.

This strong performance stemmed from a number of factors. Very favourable interest rates, vigorous employment growth, shortages in the rental and resale housing markets, and higher disposable incomes drove consumers to the new housing market.

By far the largest dollar increase was the result of higher investment in new housing, which totalled $29.2 billion in 2002, up 30.6%. Spending on renovations, the second-largest component, totalled $18.6 billion in 2002, up 7.2% from 2001. Acquisition costs rose 26.7% to $4.9 billion.

Add this news to last week’s report of higher than expected inflation, on the one hand and last week’s decreased GDP report, on the other, and Bank of Canada economists have some juggling to do before tomorrow’s rate decision. The general consensus on the Street is that the Bank will stay the course.

South of the border, Americans are experiencing an increase personal income, but in line with the mood perpetuated by White House wardrums, the denizens of the country are deciding to save rather than spend.

Personal income increased $24.1 billion, or 0.3%, and disposable personal income increased $24.1 billion, or 0.3%, in January, the U.S. Bureau of Economic Analysis reported Monday. But personal consumption expenditures decreased $8.7 billion, or 0.1%. Personal saving has increased. It was $342.0 billion in January, compared with $308.8 billion in December. Personal saving as a percentage of disposable personal income was 4.3% in January, compared with 3.9% in December.

The Institute of Supply Management will be reporting its latest index number later this morning. Investors are hoping for a healthy increase. Pre-equity futures are up Monday morning in anticipation.

On the geopolitical front, tensions seem to be easing slightly. Iraq is destroying missles forbidden by the U.N. and for Pakistani authorities are interrogating suspected 9/11 mastermind Khalid Shaikh Mohammed.

In Asia, markets rose overnight. The Nikkei average rose 127.36 points, or 1.5%, to 8,490.40, after advances by U.S. stocks on Friday. Moreover, a stronger American dollar helped boost Japanese technology companies and big exporters. In Hong Kong, the Hang Seng Index rose 146.11 points, or 1.6%, to 9,268.77.

European bourse are a little quieter in early afternoon trading. The FTSE 100 index, in London, is up 0.4% at midday, rising 14.10 to 3,669.7. The Frankfurt DAX is up 0.8%. The Paris CAC-40 is up 0.5%.

On a final note, today is the deadline for RRSP contributions for the 2002 tax year.