US Economic Outlook Downside risks abound Our baseline forecast for the US economy looks fairly benign, with GDP growth gradually picking up from 1.5% annualised in the second half of this year to 2.0% next year. However, we would stress that... 22nd August 2012 · 1 min read
Canada Economics Update Surging agricultural prices small net positive for economy While the drought threatening US farmers' crops has led to a surge in agricultural crop prices, many farmers in Western Canada are thankfully anticipating a return to normal production and in some... 22nd August 2012 · 1 min read
US Economics Update Monetary Indicators Monitor (Jul.) The annual growth rates of the narrower M1 and M2 monetary aggregates have slowed a little, but our own measure of M3, the broadest aggregate, is still growing at an annual rate of 4.5%. 20th August 2012 · 1 min read
Canada Economics Weekly Rising interest rate expectations misplaced Market expectations of higher interest rates over the next 12 months look misplaced. The global economic outlook has deteriorated, with much of Europe in recession and the US economy facing a fiscal... 17th August 2012 · 1 min read
Canada Data Response Consumer Price Index (Jul.) The decline in the official 'core' inflation figure, to 1.7% in July from 2.0% in June, was partly due to continued volatility in vehicle prices. With inflation remaining subdued and the downside... 17th August 2012 · 1 min read
US Economics Weekly Uptick in incoming data not enough to sway the Fed Since the Fed signalled at the last FOMC meeting three weeks ago that it was poised to act, the incoming economic data have, somewhat ironically, suddenly started to improve. Despite the recent uptick... 17th August 2012 · 1 min read
US Housing Market Update Land values poised to recover The recent rise in residential land values is unlikely to be a one-off. Admittedly, with the level of new home sales still low and house prices gains to remain fairly modest, the pace of the initial... 16th August 2012 · 1 min read
US Housing Market Data Response Housing Starts (Jul.) Housing starts fell slightly in July, but the forward-looking indicators rose once again. The upshot is that homebuilding will continue to support the wider economic recovery. 16th August 2012 · 1 min read
Canada Data Response Survey of Manufacturing (Jun.) The surprising 0.4% m/m decline in manufacturing sales in June was largely explained by ongoing volatility at petroleum refineries. For this same reason manufacturing sales volumes increased more... 16th August 2012 · 1 min read
Canada Economics Update Are household's turning cautious? Consumption growth has slowed in the first half of this year, a sign perhaps that households are becoming circumspect, in the face of a global economic downturn and the rising likelihood of a hard... 16th August 2012 · 1 min read
US Data Response Consumer Prices & Industrial Production (Jul. 12) The further decline in CPI inflation to a 20-month low of 1.4% in July, from 1.7%, gives the Fed even more flexibility to act next month, if it feels the economy needs a little more stimulus to drive... 15th August 2012 · 1 min read
US Data Response Retail Sales & Producer Prices (Jul.) The sharp 0.8% m/m rebound in retail sales in July was the first increase in four months, but only reversed the declines in the previous two months. So although consumers might have loosened their... 14th August 2012 · 1 min read
Canada Economics Update Rebound in Canadian dollar won't last We doubt that the recent rally in the Canadian dollar to above parity against its US counterpart will last. Admittedly, the safe haven status of the currency may continue to support it in the near... 13th August 2012 · 1 min read
US Economics Focus Are student loans the next bubble? The near-quadrupling in student loan debt over the past decade to $900bn, or 6% of GDP, is a concern, but we don't believe it represents a serious threat to the US financial system or that it will... 13th August 2012 · 1 min read
US Economics Weekly Drought a small, but unhelpful, drain on growth The loss of corn and soybean crops caused by the drought may reduce annual GDP growth by less than 0.1%. The drought is therefore not a disaster for the wider economy. But it doesn’t help when the... 10th August 2012 · 1 min read
Canada Data Response Labour Force Survey (Jul. 12) July's surprisingly large 30,400 decline in employment, following two months of paltry gains, is a bad start to the second half of this year. Admittedly, the underlying details were better than the... 10th August 2012 · 1 min read
