Canada Economics Weekly Macklem leaves the door open for a June cut Governor Tiff Macklem dropped a hint this week that the Bank of Canada may be ready to cut rates by June. There was little in the data to dissuade the Bank, with unemployment rising and bankruptcies... 8th March 2024 · 4 mins read
Canada Economics Weekly Soft landing, at least in aggregate The return to growth in the fourth quarter means it is probably safe to say that the economy has avoided recession, but that is mainly due to rapid immigration. Per capita GDP fell for the fifth... 1st March 2024 · 6 mins read
Canada Economics Weekly April back in play for first interest rate cut The encouraging January CPI data mean that the Bank of Canada’s April policy meeting is back in play for a potential interest rate cut, although it still seems more likely that the Bank will wait... 23rd February 2024 · 5 mins read
Canada Economics Weekly Activity looking reasonably healthy Signs of healthy growth going into the first quarter support our view that the Bank of Canada will probably wait until June to pivot to rate cuts. 16th February 2024 · 6 mins read
Canada Economics Weekly Labour market strength buys the Bank more time The strength of the labour market in January is another reason to think that the Bank of Canada can wait a little longer before it starts to cut interest rates. We now forecast the first interest rate... 9th February 2024 · 5 mins read
Canada Economics Weekly Productivity may finally be improving The upside surprise to fourth-quarter GDP should, somewhat counterintuitively, make the Bank of Canada more confident that inflation is heading back to 2% because it implies that productivity has... 2nd February 2024 · 6 mins read
Canada Economics Weekly Monetary policy tanker slowly turning The outlook for monetary policy all depends on whether the Bank of Canada is willing to act based on where it thinks shelter inflation is heading, rather than its current rate. The Bank’s... 26th January 2024 · 5 mins read
Canada Economics Weekly New year, no cheer There was little for the Bank of Canada to be encouraged by this week, with evidence of a further deterioration in the economy yet little sign of a fall in inflation expectations or downward pressure... 19th January 2024 · 3 mins read
Canada Economics Weekly Waiting for Trans Mountain The latest Trans Mountain regulatory hearing will determine whether the pipeline expansion is once again delayed. That would weigh further on the outlook for exports, with external demand already very... 12th January 2024 · 7 mins read
Canada Economics Weekly Housing market starting to improve Conditions in the housing market seem to be improving, with the local real estate board data pointing to a big improvement in the home sales-to-new listing ratio in December. While the unseasonably... 5th January 2024 · 5 mins read
Canada Economics Weekly Rapid immigration making the Bank’s job harder Data this week showed that the population jumped by 430,000 in the third quarter alone, almost as much as the official full-year permanent resident target of 465,000. Nonetheless, the November CPI... 22nd December 2023 · 4 mins read
Canada Economics Weekly Household debt service ratio will continue to rise Household net worth fell in the third quarter, although the recent resurgence in bond and equity prices means that should soon be reversed. It is too soon to sound the all-clear for households’... 15th December 2023 · 7 mins read
Canada Economics Weekly Bank risks doing more harm than good The Bank of Canada this week reiterated that strong immigration is putting upward pressure on inflation because housing supply is failing to keep up. Yet the Bank surely can’t be oblivious to the... 8th December 2023 · 5 mins read
Canada Economics Weekly Brighter past, gloomier future The revisions to the national accounts leave the post-pandemic recovery looking stronger than we thought. But that is partly due to intense inventory building, which leaves the economy vulnerable to a... 1st December 2023 · 5 mins read
Canada Economics Weekly FES creates a “clearer path” for Macklem It would be a stretch to say the government showed fiscal restraint in the Fall Economic Statement, but the announcement of only a few billion dollars in extra spending measures means that Finance... 24th November 2023 · 6 mins read
Canada Economics Weekly Fall statement unlikely to contain any giveaways For the first time since the pandemic, the government will find itself with less fiscal room than expected when it provides an update of its plans next week. Accordingly, we doubt that the Fall... 17th November 2023 · 6 mins read
