Latest News Kim Stenberg 29 Mar
Federal Budget 2023 … Press the Snooze Button As promised, there would be nothing much in this year’s budget for fear of stimulating inflation. The federal government faces a challenging fiscal environment and a weakening economy. Ottawa promised it would err on the side of restraint. Instead, Finance Minister Chrystia Freeland announced a $43 billion […]
Read MoreLatest News Kim Stenberg 22 Mar
Further Decline in Inflation in February Will Keep the Bank of Canada on Hold in April All eyes will be on the Federal Reserve tomorrow when they decide whether to hold rates steady because of the banking crisis or raise the overnight rate by 25 basis points (bps). Before the run on Silicon Valley […]
Read MoreLatest News Kim Stenberg 16 Mar
Housing Market Could be Poised for a Spring Rebound The Canadian Real Estate Association says home sales in February bounced 2.3% from the previous month. Homeowners and buyers were comforted by the guidance from the Bank of Canada that it would likely pause rate hikes for the first time in a year. The Canadian aggregate benchmark […]
Read MoreLatest News Kim Stenberg 15 Mar
Silicon Valley Bank (SVP) had a sterling reputation among the many tech start-ups it helped to finance. What brought SVB down was an old-fashioned bank run set off in 2021 by a series of bad decisions. That year, the stock market boomed, interest rates were near zero, and the tech sector was flush with cash. […]
Read MoreLatest News Kim Stenberg 8 Mar
The Bank of Canada HOLDS RATES STEADY Even as the Fed Promises to Push Higher As expected, the central bank held the overnight rate at 4.5%, ending, for now, the eight consecutive rate increases over the past year. The Bank is also continuing its policy of quantitative tightening. This is the first pause among major […]
Read MoreLatest News Kim Stenberg 28 Feb
Statistics Canada released the real gross domestic product (GDP) figure for the final quarter of 2022 this morning, showing a marked slowdown in economic activity. This will undoubtedly keep the central bank on the sidelines when they announce their decision on March 8. The Bank had estimated the Q4 growth rate to be 1.3%. Instead, […]
Read MoreLatest News Kim Stenberg 21 Feb
Canadian inflation decelerated meaningfully in January despite the continued strength in the economy. Labour markets remain very tight, and retail sales continue strong. Nevertheless, the Bank of Canada’s jumbo rate hikes over the past eleven months have tempered inflation from a June ’22 peak of 8.1% y/y to 5.9% in January. The 3-month average growth […]
Read MoreLatest News Kim Stenberg 13 Feb
Today’s Labour Force Survey (LFS) for January was much stronger than expected, once again calling into question how long the Bank of Canada’s rate pause will last. This report showed no evidence that the labour market is slowing in response to the vast and rapid runup in interest rates. Employment surged by 150,000–ten times more than […]
Read MoreLatest News Kim Stenberg 25 Jan
As expected, the Bank of Canada–satisfied with the sharp decline in recent inflation pressure–raised the policy rate by only 25 bps to 4.5%. Forecasting that inflation will return to roughly 3.0% later this year and to the target of 2% in 2024 is subject to considerable uncertainty. The Bank acknowledges that recent economic growth in […]
Read MoreLatest News Kim Stenberg 18 Jan
Good News on the Inflation Front in December The Consumer Price Index (CPI) rose 6.3% year over year in December, down from the 6.8% pace in November. Much of the decline was owing to the drop in gasoline prices. Additional deceleration came from homeowners’ replacement costs, fuel oil and other owned accommodation expenses, and various durable […]
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