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Bank of Canada due for ‘oversized’ 50-basis-point interest rate hike: economist – Global News

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The Bank of Canada is likely to hike its key overnight rate by half a percentage point on Wednesday, the Conference Board of Canada’s chief economist says, as the think tank’s economic forecast predicts home prices could start to drop next year.

Pedro Antunes tells Global News he expects the central bank to double its key overnight rate to one per cent at its announcement on Wednesday with an “oversized” increase of 50 basis points.

He joins the growing chorus of economists and market forecasters who are now widely expecting an interest rate hike of half a percentage point, the first since May 2000.

Back then, the nominal neutral rate — the level of interest that allows full productivity and keeps inflation on target — was around five per cent. Today, the Bank of Canada estimates the nominal neutral rate to be between 1.75 per cent and 2.75 per cent.

“A 50 (basis point) hike will do a lot more to cool the economy down today than it did back then,” said Desjardins’ head of macro strategy, Royce Mendes, in a note.

Mendes also says that the Bank of Canada will likely slow the pace of its monetary policy tightening after April and expects “further rate hikes to come in measured steps.”

“That would leave the overnight rate at 2.00 per cent at the end of the year,” he said.

Meanwhile, TD’s chief Canada strategist, Andrew Kelvin, expects the central bank to lift the overnight rate to 2.50 per cent by the end of the year.

Antunes says the move would follow similar rumblings from the U.S. Federal Reserve about a 50-basis-point hike as central banks around the world attempt to get global inflation under control.

Read more:

U.S. inflation has hit its highest level in over 40 years

Antunes spoke to Global News Tuesday following the release of the Conference Board of Canada’s latest economic forecast in a report titled “Normalcy Out the Window.”

The combination of the war in Ukraine, COVID-19 uncertainty, rising interest rates and rampant inflation has made the latest board’s latest forecasts the most complex Antunes has seen in his career.

“As Yogi Berra once said, the future ain’t what it used to be,” he says.

“I’ve been in this business of forecasting for many years now and I can’t think of another time when there’s been just so much chaos going on, really, to try and get a handle on where we think the economy is going.”

Economic growth could slow in 2023

For instance, the Conference Board report notes there’s “considerable risk” around Russia’s invasion of Ukraine, which “destabilizes a world that had been hoping for an improvement in the COVID-19 story.”

But despite the war putting inflationary pressures on food and gasoline prices, Canada’s economy stands to gain from the ongoing war as sharp rises in commodity markets will be a “massive boon” for the country’s agricultural and energy producers, Antunes says.


Click to play video: 'How war in Ukraine is threatening the global food crisis'



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How war in Ukraine is threatening the global food crisis


How war in Ukraine is threatening the global food crisis – Apr 5, 2022

Overall, the Conference Board expects Canada’s gross domestic product to grow by four per cent in 2022 before falling off slightly with a 3.3 per cent increase in 2023.

Though the board notes that many Canadians racked up significant savings over the past two years of the COVID-19 pandemic, surging gasoline prices could dampen some of the fervent spending this summer.

Demand for road trips, for example, appears to have “abated,” Antunes says, as motorists feel the pinch at the pumps.

While it could take up to 18 months before higher interest rates have a material impact on prices and Canada’s economy, Antunes says the central bank will need to deliver a higher rate hike on Wednesday to help get consumer and business expectations back under control.

When inflation expectations become unmoored, the risk is that wages will spike in response, putting pressure on businesses to then hike prices. That endless cycle of inflation and wage growth is what the bank is trying to avoid, Antunes says, by sending a message to the public that it will act to tamp down on inflation.

“It’s really trying to maintain its credibility that inflation will be contained and the bank has the tools and the wherewithal to do that,” he says.

“It’s a real challenge for the bank just to make sure that people continue to believe that we are going to see inflation return back to that two per cent target.”

But the Conference Board report also warns that Canadians with high debt levels could start to feel the pinch if the central bank enters a more aggressive monetary tightening cycle. Antunes notes many Canadians took their pandemic higher savings and put them into the housing market, making these new mortgage holders vulnerable to rate hikes.

“With the nominal household debt-to-disposable income ratio reaching a record level in the fourth quarter of 2021, higher interest rates could spell trouble for heavily indebted Canadians,” the report reads.

“We still expect the consumer to lead the way for the Canadian economy, but the combination of rising inflation and higher interest rates could make it a bumpy ride.”

How will the housing market react to rising rates?

The Conference Board report also suggests that Canada’s hot housing market could be cooling, and potentially heading for a correction.

The think tank points to rising interest rates, policy adjustments from the feds and other levels of government and changes in consumer attitudes as taking some of the gas out of the housing market.


Click to play video: 'Will interest rate changes temper the housing market?'



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Will interest rate changes temper the housing market?


Will interest rate changes temper the housing market? – Apr 4, 2022

“Following years of outsized gains, we think this could finally be the year when Canada’s housing markets slow,” the report reads.

Following 22.5 per cent growth in the aggregate resale home price last year, the Conference Board is projecting eight per cent growth in resale prices in 2022 as cooling takes effect in the second half of the year.

The board goes on to project a six per cent price drop in 2023, with the risk of a “sharper correction” if real estate investors sell their units into an easing market.

BMO senior economist Robert Kavcic told Global News in late March that a series of rate hikes, combined with government measures aimed at cooling the housing market, could see home prices could drop as much as 10 per cent over the next couple years.

He called rising interest rates “the single biggest measure we can take here to cool down the pace of home price growth and inflation more broadly.”

One of the biggest factors that could play into housing affordability is the anticipation of more supply coming onto the market, Antunes says.

The report calls builders’ efforts to ramp up the supply of housing starts a “Herculean effort” with a record number of housing starts recorded in November 2021 as the industry grappled with supply chain constraints and labour shortages.

The federal government also stated its ambitions to double the annual number of new units in Canada to 400,000 per year over the next decade.

Read more:

Canada wants to build 400,000 homes a year. Who’s going to build them?

“A lot of that has been held up. It’s been difficult to get the person power in the construction industry to finish a lot of those projects. But it is coming,” he says.

The Conference Board report’s title notwithstanding, Antunes does think there are signs of the housing market rebalancing after two years of rampant growth.

“With interest rates coming up, with normalcy coming back to the economy, perhaps demand easing up as well and helping the market kind of rebalance to something more normal,” he says.

“We just think it’s been way too frothy over the last two years.”

— with files from the Canadian Press


Click to play video: 'Federal housing money may not cool red-hot market'



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Federal housing money may not cool red-hot market


Federal housing money may not cool red-hot market

© 2022 Global News, a division of Corus Entertainment Inc.

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N.S. legal scholar’s book describes ‘mainstream’ porn’s rise, and the price women pay

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HALIFAX – When legal scholar Elaine Craig started researching pornography, she knew little about websites such as Pornhub or xHamster — and she did not anticipate that the harsh scenes she would view would at times force her to step away.

Four years later, the Dalhousie University law professor has published a book that portrays in graphic detail the rise of ubiquitous free porn, concluding it is causing harm to the “sexual integrity” of girls, women and the community at large.

The 386-page volume, titled “Mainstreaming Porn” (McGill-Queen’s University Press), begins by outlining how porn-streaming firms claim to create “safe spaces” for adults to view “consensual, perfectly legal sex,” as their moderators — both automated and human — keep depictions of illegal acts off the sites.

But as the 49-year-old professor worked through the topic, she came to question these claims. Depictions of sex that find their way onto the platforms are far from benign, she says.

“Representations of sex in mainstream porn … that weaponize sex against women and girls, that represent it as a tactic to be deployed against unconscious women or unsuspecting ‘daughters’ when their mothers are not home … do not promote sexual integrity and human flourishing,” she writes in her closing chapter.

Joanna Birenbaum, a Toronto-based lawyer who has worked with sexual assault victims for 20 years, said in a recent email that Craig’s work is the first to “really make the connection between porn, its impact on women and girls … and the ways in which it has evolved to become part of the tech industry.”

“It is eye-opening because it is so frank and concrete … for those who are unaware of what can be found on these mainstream platforms.”

For example, Canadian criminal law is clear that when a person is asleep, they lack the capacity for sexual consent. But Craig’s online searches of porn platforms found “countless videos” depicting the perpetration of sexual assault on “sleeping or unconscious women.” The difference in the pseudo-reality of porn was the women were almost always depicted as pleased and accepting.

Meanwhile, the book finds that “incest-based” porn — and the associated “tags” designed to draw viewers — are “as prolific as they are popular.” Craig said during an interview at her campus office that she believes a subset of this category, showing male family members having sex with female performers depicted as girls, meets the definition of child pornography.

Then there are the depictions of the surreptitious filming of sex without the knowledge of those being recorded, “another relatively common phenomenon on porn-streaming platforms,” she writes. In her closing chapters, she urges all provinces to pass laws to allow rapid removal of such material from sites.

For Craig, a mother of two boys, her journey into this world was draining. After writing the chapter on incest-themed porn, she had to take three months away from the project. “I found it challenging to watch some of it,” she said.

In her book, Craig notes how last year, after a judge sentenced an Ottawa man to seven years in prison for posting secret sex videos, a vice-president with Ethical Capital Partners — which owns Pornhub’s parent Aylo — said the site no longer allows individuals to search for videos under the tag, “hidden camera.”

But when Craig checked she found that, while the term “hidden camera” yielded no videos on Pornhub, using just the term “hidden” did produce results. Titles on the first page of her search results included, “Dragged a sexy classmate into bed and filmed sex on a hidden phone.” Other categories including “secret voyeur,” “real amateur hidden” and “spy” also yielded videos.

A Pornhub spokesman said in an emailed statement this week that the company has a list of more than 35,000 banned keywords and millions of permutations “that prevent users from trying to search for words that may violate our terms of service.” He said the list is “constantly evolving, with new words regularly added in multiple languages.”

In her closing chapters, Craig questions whether using criminal law to go after the producers and possessors of the porn she considers illegal will be effective. Instead she prefers a human rights approach that identifies “hateful” porn and monitors remedies over time.

Her research found that certain graphic slurs directed at women yielded links to hundreds of videos last year on Pornhub, and Craig argues these expressions can be seen as part of a “taxonomy of misogyny and racism” that the sites are building.

She argues for federal legislation to prohibit streaming companies from promoting videos with titles, tags and categories that meet the definition of hate speech — “vilification and detestation on the basis of sex or race, for example.”

The author notes that the Online Harms Act — currently before Parliament — would create a digital safety commission and impose a “duty of responsibility” on porn sites to prevent harmful content toward children. However, Craig calls for the same approach to be applied to “the unique harms” the streaming platforms are creating for women.

Craig argues against an “absolutist” ban on porn, making the case that this is unrealistic, but she calls for a landscape where “sex should not be mean” and where parents and schools start to educate teenagers about the harmful forms of sexuality they may encounter on the free platforms.

“Mainstream porn-streaming platforms should be held more responsible for preventing these harms and for bearing their costs when they fail,” she writes.

This report by The Canadian Press was first published Nov. 13, 2024.



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Trump’s appointees have criticized Trudeau, warned of border issues with Canada

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WASHINGTON – Donald Trump’s second administration is filling up with some of his most loyal supporters and many of the people landing top jobs have been critical of Prime Minister Justin Trudeau and security at Canada’s border.

One expert says there are not many Canadian allies, so far, in the president-elect’s court.

“I don’t see a whole lot of friends of Canada in there,” said Fen Hampson, a professor of international affairs at Carleton University in Ottawa and co-chair of the Expert Group on Canada-U.S. Relations.

As the Republican leader starts making crucial decisions about his administration, designations for foreign policy and border positions have sent signals to Canada, and the rest of the world, about America’s path forward.

Trump campaigned on imposing a minimum 10 per cent across-the-board import tariff. A Canadian Chamber of Commerce report suggests that would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.

The president-elect is also critical of giving aid to Ukraine in its war against Russian aggression and has attacked the United Nations, both things the Liberal government in Canada strongly backs.

Trump tapped Mike Waltz to be national security adviser amid increasing geopolitical instability, saying in a statement Tuesday that Waltz “will be a tremendous champion of our pursuit of Peace through Strength!”

Waltz, a three-term congressman from Florida, has repeatedly slammed Trudeau on social media, particularly for his handling of issues related to China.

He also recently weighed in on the looming Canadian election, posting on X that Conservative Leader Pierre Poilievre was going to “send Trudeau packing in 2025” and “start digging Canada out of the progressive mess it’s in.”

Like Trump, Waltz has been critical of NATO members that don’t meet defence spending targets — something Canada is not doing, and won’t do for years.

Trudeau promised to meet the target of spending the equivalent of two per cent of GDP on defence by 2032.

Immigration and border security were a key focus for Republicans during the election and numerous key appointees have their eyes to the north.

It’s been reported that Florida Sen. Marco Rubio, a vocal critic of China, is expected to be named Secretary of State.

Rubio has pointed to concerns at the Canada-U.S. border. He recently blasted Canada’s move to accept Palestinian refugees, claiming “terrorists and known criminals continue to stream across U.S. land borders, including from Canada.”

Trump’s choice for ambassador to the United Nations, New York Congresswoman Elise Stefanik, has also focused on the border with Canada.

Stefanik, as a member of the Northern Border Security Caucus, called for Homeland Security to secure the border, claiming there had been an increase in human and drug trafficking.

“We must protect our children from these dangerous illegal immigrants who are pouring across our northern border in record numbers,” she posted on X last month.

Stefanik has little foreign policy experience, but Trump described her as a “smart America First fighter.” She repeatedly denounced the UN, saying the international organization is antisemitic for its criticism of Israel’s bombardment of Gaza.

U.S. media reports say longtime Trump loyalist Kristi Noem, South Dakota’s governor, has been chosen to run Homeland Security. She was on the shortlist to be vice-president until controversy erupted over an anecdote in her book about shooting a dog.

“She doesn’t seem to have very warm feelings (toward Canada),” Hampson said

Last year, she claimed to be having conversations with a Canadian family-owned business looking to relocate to her state because of COVID-19 pandemic restrictions.

But Noem has also said that the Canada-U.S.-Mexico Agreement, negotiated under the first Trump administration, was “a major win.”

The trilateral agreement is up for review in 2026.

Robert Lighthizer, Trump’s former trade representative , has been an informal adviser for the president-elect’s transition and Deputy Prime Minister Chrystia Freeland said they remain in contact.

He has been touted by analysts as an option for several jobs in Trump’s second administration, including a return to the trade file, though Hampson said he is unlikely to go back to the trade representative role.

Hampson said there are still significant questions about how sweeping the tariffs could be and if there will be carve-outs for industries like energy. Trump and his team may also hang the tariff threat over upcoming trade negotiations.

“Is he going to stick us with a tariff Day 1 or shortly after?” Hampson asked.

Some experts have called for Canada to remain calm and focus on opportunities rather than fears. Others have called for bold action and creative thinking.

Canada revived a cabinet committee on Canada-U.S. relations a little more than 24 hours after Trump’s win was secured.

Trudeau said Tuesday in Fredericton that under the first Trump presidency, Canada successfully negotiated the trilateral trade deal by demonstrating that the country’s interests and economies are aligned.

“That is going to continue to be the case,” he said.

This report by The Canadian Press was first published Nov. 13, 2024.



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Toronto Sceptres open camp ahead of second PWHL season |

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The Toronto Sceptres have opened training camp for the upcoming PWHL season, with a new logo, new colours, new jerseys and a new primary venue in Coca-Cola Coliseum. The team has a lot to look ahead to after a busy off-season and successful inaugural campaign. (Nov. 12, 2024)



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