Canada Economics Update Labour shortages now widespread The expiry of the CRB this month may help to alleviate the shortages of unskilled labour, but there is little chance that the shortages of skilled labour will ease until immigration picks back up. And... 14th October 2021 · 4 mins read
Canada Economics Update What might prompt the Bank to take a hawkish turn? The sharp slowdown in economic growth in the past couple of quarters suggests that the probability of the Bank of Canada following other central banks in becoming more hawkish is low. The risk will... 6th October 2021 · 5 mins read
Canada Economics Update Withdrawal of CRB a risk to consumption Due to the still high household saving rate, we have so far been sanguine about the risks posed by the winding down of benefit payments to households. But with goods shortages limiting the scope for... 30th September 2021 · 3 mins read
Canada Economics Update Modest policy loosening to follow election There has been almost no change in the distribution of seats in Parliament following the election, but it seems likely that the minority Liberal government will press on with a modest loosening of... 21st September 2021 · 3 mins read
Canada Economics Update Canada’s election unlikely to be a key driver of the loonie We doubt that the outcome of next week’s federal election in Canada will have much bearing on the economy and the loonie. Instead, we still think that bond yield differentials and oil prices will be... 17th September 2021 · 2 mins read
Canada Economics Update Inflation to remain near 4% for next six months Recent developments have prompted us to revise up our inflation forecasts for the coming few quarters, although we still expect inflation to decline to less than 2% in the second half of next year. 16th September 2021 · 4 mins read
Canada Economics Update Conservative victory won’t be a game-changer The costed election platform released by the Conservatives this week suggests that, if they were to form a government after this month’s election, they would run a similar fiscal policy to the Liberal... 9th September 2021 · 3 mins read
Canada Economics Update Bank on hold ahead of likely October taper There are some emerging downside risks to the economic outlook both domestically and globally but, after taking a well-anticipated pause at this meeting, we do not expect those risks to prevent the... 8th September 2021 · 3 mins read
Canada Economics Update Is the Bank right to dismiss CPI-trim and CPI-median? We are not convinced by the Bank of Canada’s recent claim that CPI-trim and CPI-median are currently overstating underlying inflation, although their elevated level compared to CPI-common is mainly... 26th August 2021 · 5 mins read
Canada Economics Update What’s going on with wages? Distortions to the data mean it is hard to gauge the current pace of wage growth, but the business surveys suggest it will soon head back to pre-pandemic levels. Given the Bank’s upbeat view on the... 11th August 2021 · 4 mins read
Canada Economics Update How do our key calls compare with the consensus? Our expectations for GDP growth and inflation this year are close to the consensus but, beyond then, we think both will be weaker than most expect. This is likely to feed through to a fall in the... 4th August 2021 · 4 mins read
Canada Economics Update New CPI weights will keep a lid on inflation The introduction of new CPI weights will prevent inflation from rising by as much as in the US but, with firms’ selling price expectations continuing to increase, the risks to inflation still seem to... 22nd July 2021 · 4 mins read
Canada Economics Bank tapers its asset purchases again The Bank of Canada’s decision to continue tapering its asset purchases today came as little surprise and we continue to expect the Bank to bring the QE program to a close by the end of this year. With... 14th July 2021 · 3 mins read
Canada Economics Labour shortages set to intensify Canadian firms are not currently suffering from labour shortages to the same extent as those in the US but, with immigration still muted, the issue is likely to get worse as the economy continues to... 30th June 2021 · 2 mins read
Canada Economics Update Bank likely to taper purchases again in July The Bank did not provide any new hints about the direction of policy in its statement today but, with GDP likely to start growing strongly again this month as the coronavirus restrictions are lifted... 9th June 2021 · 3 mins read
Canada Economics Update Bank may welcome strong loonie after inflation spike The Bank of Canada has voiced concern about the loonie although, following the signs of emerging inflationary pressures in April, it will probably be more welcoming of the disinflationary impact of... 20th May 2021 · 3 mins read
