US Economics Weekly Fiscal policy stuck between a rock and a hard place Many Fed officials appear increasingly concerned that the uncertainty surrounding the outlook for fiscal policy is already starting to curb household and business spending. Unless Congress acts, a... 24th August 2012 · 1 min read
Canada Economics Weekly Labour market slack likely to increase Canada's employment gains during its economic recovery have been far from broad-based and bolstered by an oversized contribution from the public sector. In addition, the official unemployment rate... 24th August 2012 · 1 min read
US Data Response Durable Goods Orders (Jul. 12) At first glance the 4.2% m/m surge in July's durable goods orders looks very impressive, but nothing could be further from the truth. This is a very weak report. The slump in core capital goods orders... 24th August 2012 · 1 min read
Canada Economics Update Economy struggling to absorb economic slack We now estimate that second-quarter GDP grew by an estimated 1.6% annualised, slightly below the Bank of Canada's revised 1.8% prediction. More importantly, economic growth below 2% is not enough to... 24th August 2012 · 1 min read
US Housing Market Data Response New Home Sales (Jul.) July’s rise in new home sales was clearly welcome news. And it does little to dissuade us from the view that the housing market has shifted from being a clear drag on the wider economy to offering... 23rd August 2012 · 1 min read
Global Markets Update The market implications of QE3 The US Fed looks set to launch QE3 soon, but a third injection of the same medicine is unlikely to be anywhere near as effective as the first two in supporting the prices of equities or commodities... 23rd August 2012 · 1 min read
US Economics Update Fed minutes suggest QE3 is a done deal The minutes from the last FOMC meeting at the start of this month strongly suggest that the Fed will launch a third round of quantitative easing at the upcoming meeting in mid-September. While QE3... 23rd August 2012 · 1 min read
US Housing Market Data Response Existing Home Sales (Jul. 12) For now, our view that the recent dip in existing home sales was not the start of a weaker trend seems to be on track. But the combination of a subdued outlook for US economic growth and tight... 22nd August 2012 · 1 min read
Canada Data Response Retail Sales (Jun. 12) June's slight dip in retail sales volumes, paired with a decline in wholesale trade and a modest increase in manufacturing sales, indicates that monthly GDP grew by 0.1% to 0.2% m/m in June. This... 22nd August 2012 · 1 min read
US Economic Outlook Downside risks abound Our baseline forecast for the US economy looks fairly benign, with GDP growth gradually picking up from 1.5% annualised in the second half of this year to 2.0% next year. However, we would stress that... 22nd August 2012 · 1 min read
Canada Economics Update Surging agricultural prices small net positive for economy While the drought threatening US farmers' crops has led to a surge in agricultural crop prices, many farmers in Western Canada are thankfully anticipating a return to normal production and in some... 22nd August 2012 · 1 min read
US Economics Update Monetary Indicators Monitor (Jul.) The annual growth rates of the narrower M1 and M2 monetary aggregates have slowed a little, but our own measure of M3, the broadest aggregate, is still growing at an annual rate of 4.5%. 20th August 2012 · 1 min read
Canada Economics Weekly Rising interest rate expectations misplaced Market expectations of higher interest rates over the next 12 months look misplaced. The global economic outlook has deteriorated, with much of Europe in recession and the US economy facing a fiscal... 17th August 2012 · 1 min read
Canada Data Response Consumer Price Index (Jul.) The decline in the official 'core' inflation figure, to 1.7% in July from 2.0% in June, was partly due to continued volatility in vehicle prices. With inflation remaining subdued and the downside... 17th August 2012 · 1 min read
US Economics Weekly Uptick in incoming data not enough to sway the Fed Since the Fed signalled at the last FOMC meeting three weeks ago that it was poised to act, the incoming economic data have, somewhat ironically, suddenly started to improve. Despite the recent uptick... 17th August 2012 · 1 min read
US Housing Market Update Land values poised to recover The recent rise in residential land values is unlikely to be a one-off. Admittedly, with the level of new home sales still low and house prices gains to remain fairly modest, the pace of the initial... 16th August 2012 · 1 min read
