By The New Lending Services Price Index (NLSPI) decreased by 5.3% in the third quarter, following a 3.0% decrease in the second quarter.
On a year-over-year basis, the index was down 10.4% in the third quarter compared with the same quarter in 2012. The decrease in the index was primarily a result of recent increases in yields on long-term Government of Canada securities. In particular, the yield-to-maturity on Government of Canada bonds with maturities between 5 and 10 years increased by 52 basis points between May and June 2013.
Chart 1
New Lending Services Price Index
Chart description: New Lending Services Price Index
The New Lending Services Price Index (NLSPI) is not an index of loan rates paid by consumers and businesses, but represents the change in the price of service. Prices are derived as the difference between annual percentage rates for new loan products and averages of yields on financial market instruments. The variables used to derive the prices are weighted annual percentage rates for new lending services, funds advanced by product, and market rates. The NLSPIis a monthly index that is disseminated on a quarterly basis.
New lending services include newly issued funds for personal loans, lines of credit, mortgage loans, business loans, and leases. These data are combined with other data to estimate a price for new lending activity. Lending is one of the many services provided by the banking industry and this is the first in a series of financial service indexes to be published. This index will provide better estimates of real output, productivity and price change in financial services in Canada.
With each release, data for the previous quarter may have been revised. The series is also subject to an annual revision with the release of second quarter data of the following reference year. The index is not seasonally adjusted.
For a more detailed explanation of the methodology, refer to the NLSPI Methodology Summary Document.
Available in CANSIM: tables CANSIM table332-0014 and CANSIM table332-0015.
Definitions, data sources and methods: survey number survey number5207.
The New Lending Services Price Index for the fourth quarter of 2013 will be released in April.
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (613-951-4636; mediahotline@statcan.gc.ca).
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