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 unlikely to surpass their pre-pandemic level until the shortages of raw materials and intermediate inputs ease.
Stephen Brown Senior Canada Economist
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Canada Economics Weekly

Bank unconcerned about inflation outlook

The communications from the Bank of Canada this week confirmed that it is not worried about inflation surpassing its forecasts for this year, and that it remains committed to keeping the policy rate unchanged until economic slack is fully absorbed.

11 June 2021

Canada Economics Update

Bank likely to taper purchases again in July

The Bank did not provide any new hints about the direction of policy in its statement today but, with GDP likely to start growing strongly again this month as the coronavirus restrictions are lifted, we expect the Bank to cut the weekly pace of its asset purchases to $2bn at the next meeting in July.

9 June 2021

Canada Data Response

International Trade (Apr.)

The global semiconductor shortage weighed heavily on exports and imports of motor vehicles in April and this disruption continued in May. While exports elsewhere performed better, the broad-based weakness of imports confirms that domestic demand weakened at the start of the second quarter.

8 June 2021

More from Stephen Brown

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 the strength of the loonie, the Bank is unlikely to present a more hawkish policy statement or cut its asset purchases again next week.

2 June 2021

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 disruptive.

1 June 2021

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 most expect.

28 May 2021
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