Canada Economic Forecast
January 29, 2019Available data suggests the economy lost some impetus in the fourth quarter. Merchandise exports posted contractions in month-on-month terms in October and November as exports of energy products deteriorated severely. In November, retail sales also decreased notably due to reduced sales at gasoline stations and motor vehicle and parts dealers. In addition, house prices ebbed throughout the quarter, suggesting lower consumer demand. Nevertheless, the Ivey PMI was well in expansionary territory in Q4, economic growth in October rebounded and the unemployment rate ended the year at a multi-decade low. On the political front, the USMCA ratification is still contingent on U.S. Democrats’ congressional votes, raising concerns over a delay or potential renegotiations. Furthermore, the political rift with China, sparked by the arrest of a senior executive at Huawei on behalf of the U.S., could dampen economic relations with the Asian giant going forward.
Canada Economic GrowthEconomic growth is expected to continue moderating this year, with rising interest rates likely eroding growth in household spending and residential investment. That said, ratification of the USMCA would reduce uncertainty surrounding trade with the U.S. and, in turn, support mainstay export industries. Elevated household debt poses a risk to the outlook, particularly as monetary policy tightens. Met the why particular panelists estimate growth of 1.9% in 2019, which is down 0.1 percentage points from last month’s forecast, and 1.8% in 2020.
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|Bond Yield||1.93||1.00 %||Feb 13|
|Exchange Rate||1.33||0.15 %||Feb 14|
|Stock Market||15,696||0.23 %||Feb 14|
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Canada Economic News
February 13, 2019
House prices edged down 0.05% on a seasonally-adjusted monthly basis in January, according to the Teranet-National Bank National Composite House Price Index (December: -0.30% month-on-month).
February 8, 2019
Housing starts on a seasonally-adjusted annualized (SAAR) basis fell to 207,968 units in January, according to the Canada Mortgage and Housing Corporation (CMHC).
February 6, 2019
The Ivey Purchasing Managers’ Index (PMI), prepared by the Richard Ivey School of Business, dipped to 54.7 in January from 59.7 in December.
January 31, 2019
Matching analysts’ expectations, the economy shrank 0.1% month-on-month in November, following a 0.3% month-on-month expansion in October.
January 18, 2019
Seasonally-adjusted consumer prices increased 0.2% from a month earlier in December, contrasting November’s 0.1% fall (previously reported: -0.2% month-on-month).