Canada Economics Weekly Temporary factors support strong start to the year The strength of GDP growth at the start of the year reflected several temporary factors. The Bank of Canada’s latest quarterly surveys, released next week, will provide a better guide to how firms and... 31st March 2023 · 6 mins read
Canada Economics Weekly 2023 Budget unlikely to include large stimulus Despite the news this week that the population surged by more than one million last year, weak new home sales imply that construction activity will soon fall. That raises the pressure on the... 24th March 2023 · 5 mins read
Canada Economics Weekly Most of the hit from high interest rates still to come The fixed payment structure of most variable rate mortgages has cushioned households from the impact of high interest rates so far, with the data this week confirming that debt service costs remained... 17th March 2023 · 6 mins read
Canada Economics Weekly Bank maintains high bar for future rate hikes Despite the renewed hawkishness of central bankers elsewhere, the speech that followed the Bank of Canada’s policy announcement this week suggests that the bar to resume rate hikes remains high. 10th March 2023 · 5 mins read
Canada Economics Weekly Full effects of higher rates yet to be felt The latest data give the Bank of Canada plenty to think about ahead of its policy announcement next week. The data appear to lend support to the Bank’s view that a soft landing is still achievable... 3rd March 2023 · 6 mins read
Canada Economics Weekly Fall in inflation partly due to one-off effects The larger-than-expected fall in CPI inflation in January was partly due to one-off effects, but still reduces the chance that the Bank of Canada will be forced to resume raising interest rates... 24th February 2023 · 5 mins read
Canada Economics Weekly Bank still in wait-and-see mode Governor Tiff Macklem reiterated this week that the Bank of Canada wants time to assess the impact of high interest rates, suggesting it will not respond to the strength of employment by immediately... 17th February 2023 · 6 mins read
Canada Economics Weekly Strong employment won’t force the Bank to do more The surge in employment and rise in hours worked in January suggest that economic activity continued to expand at the start of 2023 and present clear upside risks to our forecasts for GDP growth... 10th February 2023 · 5 mins read
Canada Economics Weekly Mixed signals There were more mixed signals this week on how the economy is coping with higher interest rates. The GDP data suggest fourth-quarter growth was stronger than initially expected and the manufacturing... 3rd February 2023 · 6 mins read
Canada Economics Weekly Easing labour shortages support Bank’s pause Governor Tiff Macklem stressed on Wednesday that the pause in the Bank of Canada’s tightening cycle is conditional on looser conditions in the labour market and a fall in inflation expectations. The... 27th January 2023 · 5 mins read
Canada Economics Weekly Core inflation revisions won’t change Bank’s thinking The CPI-trim and CPI-median measures of core inflation will be revised up next month but that does not change our view that they will fall sharply over the first half of this year. We think the 25 bp... 20th January 2023 · 4 mins read
Canada Economics Weekly A pivotal week for policy outlook The December CPI data and the Bank of Canada’s quarterly business and consumer surveys, released next week, could have a big bearing on the policy outlook. For the Bank to pause after one final 25 bp... 13th January 2023 · 7 mins read
Canada Economics Weekly Resilient labour market may force Bank to do more The resilience of the labour market is a risk to our view that the Bank of Canada will pause its tightening cycle after a final 25 bp hike this month, even as the slump in natural gas prices raises... 6th January 2023 · 4 mins read
Canada Economics Weekly Strong services inflation keeps pressure on the Bank The November CPI data were a mixed bag, with deflationary pressure on goods starting to feed through but strong price rises for several key services. The 3-month annualised measures of core inflation... 23rd December 2022 · 6 mins read
Canada Economics Weekly Household net worth squeezed further One third of the rise in household net worth during the pandemic has now been reversed and the further fall in house prices in November points to another deterioration this quarter. Lower net worth... 16th December 2022 · 7 mins read
Canada Economics Weekly Bank’s latest hike puts further pressure on housing The Bank of Canada’s 50bp rate hike this week means that variable mortgage rates are now more than 400bp higher than the start of the year. This raises the risk that some will be forced to sell their... 9th December 2022 · 5 mins read
