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As impeachment captures attention, Trump tries to shift focus to the economy

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Exaggerating the strong economy (and speaking in the third person) Trump this week sought to brand this the best economy in the history of the world.
In the Oval Office Thursday, he complained that the Senate’s passage of his re-worked North American Free Trade Agreement between Mexico, Canada and the United States, was not the top news story.
“Today we just had passed the USMCA. It’s going to take the place of NAFTA, which was a terrible deal. The USMCA will probably be second to this witch hunt hoax,” he said, with a map of the 2016 election results on the desk in front of him. “Think of it. The president of the US who has led the greatest growth, the greatest economically viable of any country anywhere in the world is the United States as big as it is. We’re doing better than any other country by far. Our unemployment rates are the best in over 50 years. African American, Asian, African American, Hispanic American unemployment best in the history of our country. I have to go through a hoax.”
A day earlier, before Wednesday’s signing of a Phase One trade deal with China, as impeachment gripped Capitol Hill, the president commanded the stage for nearly 40 minutes thanking the negotiators, business leaders and lawmakers in the room. (And TV host Lou Dobbs.)
He took credit for stock market records and, sounding more like a TV producer than a president, he applauded White House economic adviser Larry Kudlow for using his TV savvy to calm investors on a down day for the market.
“He was standing in the middle of the Rose Garden. He had a beautiful scarf waving in the wind. He was everything perfect, right out of Greenwich, Connecticut. He started talking, and by the time he finished, I said, you just made a trillion, because the market just went up 250 points,” he said.
With or without administration cheerleading, the stock market is at record highs. And jobless rates are at historic lows.
The economy is really good. But it’s no GOAT, or greatest of all time.
Economic growth is hovering around two percent — hardly the rocket-fueled growth Trump promised from tax cuts and deregulation. In fact, economic growth has been stronger many times before, including some quarters of the Obama recovery, in the Clinton years and certainly post World War II. And jobs growth in the first 34 months of the Trump economy lags the last 34 months of the Obama economy.
But the president owns this message, exaggerations and all.
Senator Michael Bennet, A Democrat from Colorado, outlined a counter-narrative to Wolf Blitzer.
“Barack Obama’s administration created more jobs than Donald Trump’s administration on average per month. If Donald Trump were creating jobs at the same rate Barack Obama were creating jobs, we’d have a million more jobs here in this country right now. And our farm bankruptcies have been up over 24%. Farm income is down 16%. The president has had to basically pay off farmers with $28 billion he borrowed from the Chinese to keep them afloat DURING THIS TRADE DEAL. Things are the not great for everybody in this economy.”
Still, the strong economy is central to the president’s re-election strategy. Two big questions. Can the president stay on that message? And can Democrats find an economy message of their own that resonates.

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Canadian retail sales slide in April, May as COVID-19 shutdown bites

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Canadian retail sales plunged in April and May, as shops and other businesses were shuttered amid a third wave of COVID-19 infections, Statistics Canada data showed on Wednesday.

Retail trade fell 5.7% in April, the sharpest decline in a year, missing analyst forecasts of a 5.0% drop. In a preliminary estimate, Statscan said May retail sales likely fell by 3.2% as store closures dragged on.

“April showers brought no May flowers for Canadian retailers this year,” Royce Mendes, senior economist at CIBC Capital Markets, said in a note.

Statscan said that 5.0% of retailers were closed at some point in April. The average length of the closure was one day, it said, citing respondent feedback.

Sales decreased in nine of the 11 subsectors, while core sales, which exclude gasoline stations and motor vehicles, were down 7.6% in April.

Clothing and accessory store sales fell 28.6%, with sales at building material and garden equipment stores falling for the first time in nine months, by 10.4%.

“These results continue to suggest that the Bank of Canada is too optimistic on the growth outlook for the second quarter, even if there is a solid rebound occurring now in June,” Mendes said.

The central bank said in April that it expects Canada’s economy to grow 6.5% in 2021 and signaled interest rates could begin to rise in the second half of 2022.

The Canadian dollar held on to earlier gains after the data, trading up 0.3% at 1.2271 to the greenback, or 81.49 U.S. cents.

(Reporting by Julie Gordon in Ottawa, additional reporting by Fergal Smith in Toronto, editing by Alexander Smith)

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Canadian dollar notches a 6-day high

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The Canadian dollar strengthened for a third day against its U.S. counterpart on Wednesday, as oil prices rose and Federal Reserve Chair Jerome Powell reassured markets that the central bank is not rushing to hike rates.

Markets were rattled last week when the Fed shifted to more hawkish guidance. But Powell on Tuesday said the economic recovery required more time before any tapering of stimulus and higher borrowing costs are appropriate, helping Wall Street recoup last week’s decline.

Canada is a major producer of commodities, including oil, so its economy is highly geared to the economic cycle.

Brent crude rose above $75 a barrel, reaching its highest since late 2018, after an industry report on U.S. crude inventories reinforced views of a tightening market as travel picks up in Europe and North America.

The Canadian dollar was trading 0.3% higher at 1.2271 to the greenback, or 81.49 U.S. cents, after touching its strongest level since last Thursday at 1.2265.

The currency also gained ground on Monday and Tuesday, clawing back some of its decline from last week.

Canadian retail sales fell by 5.7% in April from March as provincial governments put in place restrictions to tackle a third wave of the COVID-19 pandemic, Statistics Canada said. A flash estimate showed sales down 3.2% in May.

Still, the Bank of Canada expects consumer spending to lead a strong rebound in the domestic economy as vaccinations climb and containment measures ease.

Canadian government bond yields were mixed across a steeper curve, with the 10-year up nearly 1 basis point at 1.416%. Last Friday, it touched a 3-1/2-month low at 1.364%.

(Reporting by Fergal Smith; editing by Jonathan Oatis)

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Toronto Stock Exchange higher at open as energy stocks gain

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Toronto Stock Exchange edged higher at open on Wednesday as heavyweight energy stocks advanced, while data showing a plunge in domestic retail sales in April and May capped the gains.

* At 9:30 a.m. ET (13:30 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was up 16.77 points, or 0.08%, at 20,217.42.

(Reporting by Amal S in Bengaluru; Editing by Sriraj Kalluvila)

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