Municipal Bonds

Toronto borrowing costs rise as Ford drug scandal deepens

Izzy Best, CNBC News Associate
Toronto Mayor Rob Ford wags his finger at the councillors warning them before the vote is called as council debates the motion to limit the Mayors office budget. Toronto, November 18, 2013.
David Cooper | Toronto Star | Getty Images

Toronto Mayor Rob Ford's crack scandal appears to be driving up Toronto's borrowing costs, Bloomberg reported on Wednesday.

Toronto's borrowing costs versus federal benchmarks have risen an additional four basis points in the aftermath of the city council asking Ford to resign after he admitted to smoking crack cocaine while mayor.

"I would characterize the challenges the city faces as urgent," Derek Burleton, deputy chief economist at Toronto-Dominion Bank, told Bloomberg.

Amid the upheaval of local politics, Toronto also faces a slowing housing boom and delays to mend the transportation infrastructure from gridlock and improve commuting.

To replace Ford until elections are held October 2014, the city council will rely on the deputy mayor, Norm Kelly, to lead operations, Bloomberg reported.

To read the full Bloomberg story click here.