Manufacturing Sales (Aug.)

Manufacturing sales volumes were a bit stronger than we expected in August, but the renewed cuts to production at auto production plants in September suggest that sales volumes fell again last month.
Stephen Brown Senior Canada Economist
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Canada Economics Weekly

Economic growth to disappoint as CRB ends

The winding down of government support to households and firms means the economy faces a large fiscal contraction this quarter, which we think will cause GDP growth to disappoint.

22 October 2021

Canada Data Response

Retail Sales (Aug.)

Retail sales increased markedly in August, as expected, but they appear to have fallen sharply in September and the expiry of the CRB presents a downside risk to spending over the rest of the year.

22 October 2021

Bank of Canada Watch

Bank to call time on QE

We expect the Bank of Canada to call time on its net asset purchases next week by transitioning to the “reinvestment phase” of QE.  Widespread labour shortages suggest economic slack is being rapidly absorbed, but the current low rate of wage growth and well-anchored inflation expectations imply the Bank will keep its interest rate guidance unchanged.

21 October 2021

More from Stephen Brown

Canada Economics Weekly

Heading off a fiscal cliff?

There have been rumours this week that the government will extend some of the emergency spending measures that are soon due to expire. They are unlikely to be extended in their current generous form, however, which suggests the economy faces a large fiscal contraction this quarter.

8 October 2021

Canada Data Response

Labour Force Survey (Sep.)

The surprisingly strong gain in September means that employment is now back in line with its pre-pandemic level, but the still elevated unemployment rate and only moderate pace of wage growth suggests that the Bank of Canada is unlikely to turn more hawkish later this month.

8 October 2021

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 rise, however, if the September Labour Force Survey shows a marked acceleration in wage growth or the Bank’s quarterly business and consumer surveys reveal a sharp increase in inflation expectations.

6 October 2021
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