Canada Economics Update Growing labour market slack to restrain core inflation Recent headline employment gains mask a deterioration in underlying labour market conditions. If, as we fear, the economy continues to struggle in response to the worsening oil price slump, then... 10th November 2015 · 1 min read
Energy Update What does the Keystone XL veto mean for oil prices? The recently-vetoed Keystone XL pipeline would have provided a relatively cheap means for Canadian producers to transport oil to refineries in the US where it could be processed for sale. As such, the... 9th November 2015 · 1 min read
Canada Economics Weekly Even the bulls are nervous about housing now Investors who have paid attention to indicators of growing imbalances in Canada’s hot housing market over the years won’t be surprised by recent warnings of potential housing corrections from certain... 6th November 2015 · 1 min read
Canada Data Response Labour Force Survey (Oct.) The 44,400 gain in employment in October was stronger than anyone expected and an indication the economy is withstanding the oil shock better than previously thought. While the details weren’t quite... 6th November 2015 · 1 min read
Canada Economic Outlook Economy will struggle to cope with oil shock Although the mild recession in the first half of this year has ended, the drag from falling business investment triggered by the slump in oil prices is far from over and growing imbalances in the... 4th November 2015 · 1 min read
Canada Data Response International Merchandise Trade (Sep.) Exports lost momentum during the third quarter, with volumes stagnating in September after falling in August, suggesting that the economy is unlikely to sustain the estimated 2.5% annualised GDP... 4th November 2015 · 1 min read
Canada Economics Weekly Core inflation measure likely to be switched next year Given the success of inflation targeting at lowering trend inflation and anchoring inflation expectations, the formal inflation-control agreement between the Bank of Canada and Federal government isn... 30th October 2015 · 1 min read
Canada Chart Pack Another interest rate cut shouldn’t be ruled out Financial markets are going cold on the prospect of another rate cut from the Bank of Canada. The Bank has already cut rates twice this year in response to the oil shock. Although the economy may no... 28th October 2015 · 1 min read
Canada Economics Weekly Bigger fiscal expansion may eventually be needed Canada’s growth outlook is one of the weakest among G7 members and other advanced economies. Low commodity prices are the main reason for this. With falling business investment weighing the economy... 23rd October 2015 · 1 min read
Canada Data Response Consumer Prices (Sep.) The 0.2% m/m decline in consumer prices in September, which pushed the annual inflation rate down to 1.0%, from 1.3%, was almost entirely due to a big slump in gasoline prices. Gasoline prices fell by... 23rd October 2015 · 1 min read
Canada Data Response Retail Sales (Aug.) The 0.7% m/m gain in retail sales volumes in August was larger than we had assumed and indicates that a stronger showing in third-quarter real consumer spending is an upside risk to our overall GDP... 22nd October 2015 · 1 min read
Canada Economics Update Liberal fiscal plan may lift growth modestly The Liberal party’s surprise majority Federal election victory has been shrugged off by financial markets, which is a good thing considering the already uncertain economic outlook. The Liberals pledge... 20th October 2015 · 1 min read
Canada Economics Weekly Inflation targeting policy not enough Canada’s inflation target agreement between the Federal government and the Bank of Canada is up for renewal next year and the conventional wisdom is that it doesn’t need fixing. In contrast, we think... 16th October 2015 · 1 min read
Canada Data Response Survey of Manufacturing (Aug.) The slight decline in manufacturing sales volumes in August echoes the decline in exports already reported for that month, providing more evidence that the recovery from the first-half recession is... 16th October 2015 · 1 min read
Canada Data Response Teranet-National Bank House Prices (Sep.) The rate of house price inflation rose to 5.6% in September and the elevated sales-to-new listings ratio indicates that it will accelerate to 6.0% by the end of the year. The national average... 15th October 2015 · 1 min read
Bank of Canada Watch Bank likely to be more guarded against global risks We expect the Bank of Canada to hold its policy rate at 0.50% next week and retain its neutral stance on the rate outlook. The incoming data indicate that third-quarter GDP growth was stronger than... 14th October 2015 · 1 min read
