Canada Economics Update Will core inflation continue to rise? The upward trend in core inflation over the past year is as much a reflection of past weakness as current strength. Core inflation looks set to remain near 2% in the coming months before dropping back... 25th July 2018 · 1 min read
Canada Economics Update Are better times ahead for exporters? New manufacturing orders have recently risen strongly and exporters are more optimistic than they have been in years. However, there are a number of reasons to doubt that an export revival is on the... 19th July 2018 · 1 min read
Canada Economics Update Bank hikes and adopts a somewhat hawkish tone Alongside its decision to raise the key policy rate from 1.25% to 1.50%, the Bank of Canada maintained a fairly hawkish tone in its policy statement. While this suggests that the Bank intends to raise... 11th July 2018 · 1 min read
Canada Economics Update What do tariffs mean for inflation? The tariffs announced so far are unlikely to boost Canadian inflation by much more than 0.1% pt, while the effects on economic growth should also be small. We therefore doubt that they will have much... 10th July 2018 · 1 min read
Canada Economics Update NAFTA feud escalates The markets have dismissed the G7 trade spat between President Donald Trump and Prime Minister Justin Trudeau as much ado about nothing, which is understandable given the former’s infamously bellicose... 12th June 2018 · 1 min read
Canada Economics Update Bank takes a more hawkish view The Bank of Canada left its key policy rate unchanged at 1.25% today but issued a slightly more hawkish statement, which will raise expectations of a rate hike later this year. 30th May 2018 · 1 min read
Canada Economics Update Bank of Canada moving to side lines The Bank of Canada left its key policy rate unchanged at 1.25% at today's Governing Council meeting and, although the markets still anticipate a further 25bp rate hike later this year, we think the... 18th April 2018 · 1 min read
Canada Economics Update Business Outlook Survey (Q1) The latest Business Outlook Survey could unnerve the Bank of Canada since it suggests that GDP growth will slow to below potential this year, while at the same time there are clear signs of mounting... 9th April 2018 · 1 min read
Canada Economics Update Household deleveraging likely to restrain growth The small income-driven decline in the household debt-to-income ratio in the fourth quarter of 2017 provides a glimmer of hope that the economy might be able to successfully grow its way out of debt... 15th March 2018 · 1 min read
Canada Economics Update Bank of Canada won't risk further rate hikes The Bank of Canada implied in its policy statement this morning that, despite growing concerns around trade, it still believes further interest rate increases will be needed later this year. That said... 7th March 2018 · 1 min read
Canada Economics Update Federal Budget (2018) Finance Minister Bill Morneau didn’t deliver any new major tax or spending measures in the 2018 Federal Budget, despite massive US corporate tax cuts and widespread fears of NAFTA’s potential demise... 27th February 2018 · 1 min read
Canada Economics Update TPP deal overshadowed by NAFTA uncertainty The news that Canada has reached a deal on a new free trade agreement with the remaining ten TPP countries is no game changer since, even in the long term, the boost to Canadian GDP will be a trivial... 23rd January 2018 · 1 min read
Canada Economics Update Bank of Canada likely to hike interest rates further The Bank of Canada’s raised interest rates to 1.25% today, from 1.00%, and its more upbeat economic outlook suggests that it will hike rates again later this year, probably in April. In contrast to... 17th January 2018 · 1 min read
Canada Economics Update Businesses shrugging off NAFTA uncertainty The improvement in business sentiment in the fourth quarter of last year, most notably the marked rebound in investment and hiring intentions, suggest that the increased uncertainty around NAFTA isn’t... 8th January 2018 · 1 min read
Canada Economics Update Key forecast calls for 2018 Although the economy probably grew by 3% in 2017, the gains were overly-dependent on the heavily indebted household sector. That was possible when interest rates were near record lows and home values... 7th December 2017 · 1 min read
Canada Economics Update Bank of Canada interest rate hike cycle over The Bank of Canada’s decision to keep interest rates at 1.00% today and its cautious policy statement indicate that, in contrast to the market view, it is in no hurry to raise rates again soon. We... 6th December 2017 · 1 min read