Building permit numbers continue to soar. The permit numbers beat expectations again today, with a 5.4% jump to record levels. This trend is one of several pieces of economic data that inspired the Bank of Canada to raise the bank rate this morning.

“Part of the Bank’s motivation for cooling the economy, or at least removing last fall’s emergency stimulus, can be seen in the stronger-than-expected 5.4% jump in April building permits,” says RBC Financial’s economic team.

Residential building permits surged 10.1% in April to another record value, says RBC, beating the previous record level set in February by nearly 9%. “There’s no denying the housing market is hot in many parts of the country. With permits issued for 19,800 housing units, residential construction will be a strong upward influence on second quarter GDP growth.”

The increased supply, combined with interest rate hikes, should act to let off much of the excess steam in housing prices later on this year, says RBC. “At the same time, very healthy nationwide job gains mean housing demand will remain generally robust, pushing prices steadily higher.”

“Interestingly, the non-residential market is decidedly gloomy, with April marking the third consecutive drop in permits. The bleak corporate profit picture of the last year combined with a still-uncertain outlook is enough to convince firms that now is not yet the time to be adding facilities. The outlook, however, is brighter. Industrial permits surged a whopping 62.8% in April,” says RBC.