Global Markets Update We expect gradual increases in 10-year DM bond yields We think most developed market (DM) central banks will look through temporary rises in inflation and leave rates unchanged until at least early 2023. Even so, we expect the yields of 10-year DM... 3rd June 2021 · 4 mins read
Bank of Canada Watch Bank to wait until July before tapering again Inflation surpassed the upper limit of the Bank of Canada’s target range in April but, with second-quarter GDP growth set to be weaker than the Bank expected and Governor Tiff Macklem concerned about... 2nd June 2021 · 7 mins read
Canada Data Response GDP (Q1) The first-quarter data confirm that the economy took the second coronavirus wave in its stride but, with the preliminary estimate showing that GDP fell in April, the third wave has been much more... 1st June 2021 · 2 mins read
Canada Economics Weekly Hot economy summer The re-opening plans set out in the last couple of weeks point to strong gains in GDP over the summer. Given supply constraints, we expect the increase in activity to result in higher inflation than... 28th May 2021 · 5 mins read
Canada Chart Pack Upside risks to inflation as the economy re-opens The jump in inflation to 3.4% in April was stronger than most forecasters expected and, with firms’ selling price expectations rising again in May, there seem to be further upside risks to inflation... 27th May 2021 · 8 mins read
Canada Economics Focus Tackling climate change will be costlier than elsewhere Over the next few years, there is potential for increased “green” investment to more than offset the negative economic effects of measures such as further carbon tax hikes. But given the economy’s... 26th May 2021 · 16 mins read
Canada Economics Weekly Bank monitoring housing for signs of “exuberance” The latest Financial System Review suggests that the Bank of Canada’s concerns about high house price inflation are a key risk to our view that it will wait until early 2023 before raising interest... 21st May 2021 · 4 mins read
Canada Data Response Retail Sales (Mar.) After reaching a record high in March, the preliminary estimate suggests that the lockdowns caused retail sales to slump in April. There is likely to be only a small rise this month given stores have... 21st May 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
Canada Data Response Consumer Prices (Apr.) The large 0.6% m/m seasonally-adjusted rise in prices in April shows that the jump in inflation to 3.4% was not due to base effects alone. With firms’ selling price expectations elevated, we expect... 19th May 2021 · 2 mins read
Canada Economics Weekly Vaccinations now outpacing most countries After being constrained for months by a lack of supply, vaccinations in Canada are now outpacing those in every other G20 nation. Nevertheless, the cautious approach by policymakers suggest that... 14th May 2021 · 5 mins read
Canada Data Response Manufacturing Sales (Mar.) The 2.3% m/m rise in March was not enough to prevent manufacturing sales volumes from falling during the first quarter. The sector should perform better in the second quarter, but sales volumes are... 14th May 2021 · 3 mins read
Canada Economics Update Inflation to be above 3% for most of the year We now expect inflation to surpass the upper limit of the Bank of Canada’s 1% to 3% range for most of the rest of the year, but we continue to think that it will drop back to less than 2% in 2022. 13th May 2021 · 4 mins read
Canada Economics Weekly Home sales decline for first time this year Home sales appear to have declined in April and further falls could act as a headwind to the recovery over the rest of the year. 7th May 2021 · 4 mins read
Canada Data Response Labour Force Survey (Apr.) The third coronavirus wave caused the labour market recovery to go into reverse in April and, with no imminent sign of the restrictions being eased, there is little chance of a meaningful rebound this... 7th May 2021 · 2 mins read
Canada Economics Update Higher commodities prices another tailwind to growth The further strong rises in commodity prices present upside risks to our GDP forecasts, although the boost to growth is likely to be smaller than during previous periods of strong commodity price... 6th May 2021 · 4 mins read
