Bank to remain on pause

Governor Tiff Macklem will probably be feeling happy with the initial stages of the recovery. While the second-quarter GDP data confirmed that output contracted by 39% annualised, that was at least...

2nd September 2020 · 6 mins read

GDP (Q2 & Jun.)

The second-quarter GDP data confirm that the lockdown caused an unprecedented record contraction of 38.7% annualised, but the larger-than-expected rise in GDP in June at least provides a strong...

28th August 2020 · 2 mins read

‘Freeconomics’ could see Canada outperform

New Finance Minister Chrystia Freeland has already shown her colours by ramping up fiscal spending after just one day on the job, and her previous calls for a “new New Deal” to address inequality...

26th August 2020 · 4 mins read

Upside risks growing for core inflation

Firms’ selling price expectations rose further in July and are now higher than before the lockdown started in March, which seems to suggest that an average of the Bank of Canada’s three core inflation...

25th August 2020 · 9 mins read

Government extends financial aid for households

It has been a busy week for the government, with the resignation of Finance Minister Bill Morneau, the proroguing of Parliament until 23rd September, and the announcement of extended financial aid for...

21st August 2020 · 5 mins read

Retail Sales (Jun.)

The rise in retail sales in June, to above their pre-virus level, reflects higher spending on goods at the expense of lower spending on services. Nevertheless, with the government further boosting...

21st August 2020 · 2 mins read

Immigration the key risk to construction

Recent building permit issuance and the rise in home sales to a record high bode well for housing starts for the rest of 2020, but the outlook beyond then will depend largely on whether immigration...

21st August 2020 · 4 mins read

Teranet House Prices (Jul.)

House prices fell in seasonally-adjusted terms in July, but the surge in home sales to a record high last month suggests this move will soon be reversed and house prices will resume their march higher...

20th August 2020 · 2 mins read

Consumer Prices (Jul.)

Improved data collection following disruption related to Covid-19 contributed to declines in inflation for travel-related items in July, which weighed on both headline and core inflation. This effect...

19th August 2020 · 2 mins read

Construction outpacing manufacturing

The data this week imply that the recovery in construction is ahead of that in manufacturing, which is partly thanks to the swift rebound in home sales.

14th August 2020 · 7 mins read

Manufacturing Sales (Jun.)

The manufacturing sector has bounced back faster than most expected, but it is likely that the pace of gains will now slow sharply, and that output will remain below pre-virus levels until 2021.

14th August 2020 · 2 mins read

Widening current account deficit not a big concern

The current account deficit is set to widen during the coming few quarters as the recovery in imports outpaces that in exports, but we do not think this poses a risk to the economy or to the exchange...

12th August 2020 · 3 mins read

Employment recovery outpacing the US

The labour market recovery moved ahead of that in the US in July, but we doubt this means the Canadian economy will outperform in the longer-term.

7th August 2020 · 4 mins read

Labour Force Survey (Jul.)

The 419,000 rise in employment in July means that 55% of the three million pandemic-related job losses have now been reversed. We expect further gains in August and September to pull the unemployment...

7th August 2020 · 2 mins read

International Trade (Jun.)

Imports recovered more strongly than exports in June and we expect this trend to continue in the second half of the year. This implies net trade will hold back GDP growth during the initial stages of...

5th August 2020 · 2 mins read