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Canada’s economy got a lift late last year. Why that might delay rate cuts – Global News

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Canada’s flatlining economy showed signs of life heading into the end of 2023.

While data released from Statistics Canada Wednesday indicates the country may have avoided a recession, the bad news is that might push back the timeline for interest rate cuts.

The agency reported that real gross domestic product rose 0.2 per cent in November, thanks largely to strength in goods-producing sectors.

Manufacturing and wholesale trade saw growth in the month, and the transportation and warehousing sectors rebounded in the wake of the St. Lawrence Seaway strike dragging down the sector in October.

The Quebec public service strike meanwhile limited growth, with StatCan pointing to declines in the educational services sector tied to the work stoppages.

November marks the first month of growth since May 2023. With interest rates at the highest level seen in decades, the Canadian economy has been struggling to grow.


Click to play video: 'Business Matters: Canada’s economy stalls, again'

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Business Matters: Canada’s economy stalls, again


StatCan’s initial estimates for December show a possible acceleration in growth to 0.3 per cent on a monthly basis, though these reports will be updated at the end of February.


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But early signs of growth growth suggest Canada’s economy grew overall in the fourth quarter, potentially skirting a technical recession after a contraction in the third quarter.

Early StatCan estimates show real GDP grew at an annualized pace of 1.2 per cent in the fourth quarter, while the Bank of Canada called for essentially flat growth in its latest forecasts. Economists expect growth to remain weak in the first half of this year, before picking back up in the second half of 2024.

Rate cut bets scaled back

The central bank has been looking for signs that the economy is slowing and demand is easing to give it confidence that inflation will continue to trend back down to its two per cent target.

The Bank of Canada gave its clearest hints yet that its benchmark interest rate might have peaked last week as it delivered its fourth consecutive hold.

While conversations among economists have pivoted to when rate cuts might begin, with most calls for easing starting in the spring or summer, BMO chief economist Doug Porter said in a note to clients Wednesday that the stronger-than-expected GDP result takes some of the pressure off the Bank of Canada to start cutting before it’s sure inflation is on a sustainable path back to two per cent.

“This solid result, after a long dry spell for growth, affords policymakers the ability to gently push back on easing chatter, as they wait for underlying inflation to come down further,” he wrote.


Click to play video: 'Economists expect spring interest rate cut after Bank of Canada holds steady'

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Economists expect spring interest rate cut after Bank of Canada holds steady


Money markets pared bets for an April rate cut to a 42 per cent chance from a 51 per cent chance before the growth figures, according to Reuters.

CIBC senior economist Andrew Grantham meanwhile said in a note that bond yields – a key metric informing fixed mortgage rates – also pushed higher Wednesday morning amid expectations of a June cut rather than April.

But Grantham said the Q4 bounceback, if it holds, is likely tied more to an easing in previous supply constraints than a surge in consumer demand.

He said he suspects the Bank of Canada will be more concerned with upcoming inflation and labour data than GDP figures in gauging how long to keep its policy rate elevated.

– with files from The Canadian Press, Reuters

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Langford, Heim lead Rangers to wild 13-8 win over Blue Jays

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ARLINGTON, Texas (AP) — Rookie Wyatt Langford homered, doubled twice and became the first Texas player this season to reach base five times, struggling Jonah Heim delivered a two-run single to break a sixth-inning tie and the Rangers beat the Toronto Blue Jays 13-8 on Tuesday night.

Leody Taveras also had a homer among his three hits for the Rangers.

Langford, who also walked twice, has 12 homers and 25 doubles this season. He is hitting .345 in September.

“I think it’s really important to finish on a strong note,” Langford said. “I’m just going to keep trying to do that.”

Heim was 1-for-34 in September before he lined a single to right field off Tommy Nance (0-2) to score Adolis García and Nathaniel Lowe, giving Texas a 9-7 lead. Heim went to the plate hitting .212 with 53 RBIs after being voted an All-Star starter last season with a career-best 95 RBIs. He added a double in the eighth ahead of Taveras’ homer during a three-run inning.

Texas had 13 hits and left 13 men on. It was the Rangers’ highest-scoring game since a 15-8 win at Oakland on May 7.

Matt Festa (5-1) pitched 1 1/3 scoreless innings to earn the win, giving him a 5-0 record in 13 appearances with the Rangers after being granted free agency by the New York Mets on July 7.

Nathan Eovaldi, a star of Texas’ 2023 run to the franchise’s first World Series championship, had his worst start of the year in what could have been his final home start with the Rangers. Eovaldi, who will be a free agent next season, allowed 11 hits (the most of his two seasons with Texas) and seven runs (tied for the most).

“I felt like early in the game they just had a few hits that found the holes, a few first-pitch base hits,” said Eovaldi, who is vested for a $20 million player option with Texas for 2025. “I think at the end of the day I just need to do a better job of executing my pitches.”

Eovaldi took a 7-3 lead into the fifth inning after the Rangers scored five unearned runs in the fourth. The Jays then scored four runs to knock out Eovaldi after 4 2/3 innings.

Six of the seven runs scored against Toronto starter Chris Bassitt in 3 2/3 innings were unearned. Bassitt had a throwing error during Texas’ two-run third inning.

“We didn’t help ourselves defensively, taking care of the ball to secure some outs,” Blue Jays manager John Schneider said.

The Blue Jays’ Vladimir Guerrero Jr. had a double and two singles, his most hits in a game since having four on Sept. 3. Guerrero is hitting .384 since the All-Star break.

TRAINER’S ROOM

Blue Jays: SS Bo Bichette (calf) was activated and played for the first time since July 19, going 2 for 5 with an RBI. … OF Daulton Varsho (shoulder) was placed on the 10-day injured list and will have rotator cuff surgery … INF Will Wagner (knee inflammation) was placed on the 60-day list.

UP NEXT

Rangers: LHP Chad Bradford (5-3, 3.97 ERA) will pitch Wednesday night’s game on extended five days’ rest after allowing career highs in hits (nine), runs (eight) and home runs (three) in 3 2/3 innings losing at Arizona on Sept. 14.

Blue Jays: RHP Bowden Francis (8-4, 3.50) has had two no-hitters get away in the ninth inning this season, including in his previous start against the New York Mets on Sept. 11. Francis is the first major-leaguer to have that happen since Rangers Hall of Famer Nolan Ryan in 1989.

AP MLB:

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Billie Jean King set to earn another honor with the Congressional Gold Medal

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WASHINGTON (AP) — Billie Jean King will become the first individual female athlete to be awarded the Congressional Gold Medal.

Reps. Brian Fitzpatrick of Pennsylvania and Mikie Sherrill of New Jersey announced Tuesday that their bipartisan legislation had passed the House of Representatives and would be sent to President Joe Biden for his signature.

The bill to honor King, the tennis Hall of Famer and activist, had already passed unanimously in the Senate.

Sherrill, a Democrat, said in a statement that King’s “lifetime of advocacy and hard work changed the landscape for women and girls on the court, in the classroom, and the workplace.”

The bill was introduced last September on the 50th anniversary of King’s victory over Bobby Riggs in the “Battle of the Sexes,” still the most-watched tennis match of all-time. The medal, awarded by Congress for distinguished achievements and contributions to society, has previously been given to athletes including baseball players Jackie Robinson and Roberto Clemente, and golfers Jack Nicklaus, Byron Nelson and Arnold Palmer.

King had already been awarded the Presidential Medal of Freedom in 2009. Fitzpatrick, a Republican, says she has “broken barriers, led uncharted paths, and inspired countless people to stand proudly with courage and conviction in the fight for what is right.”

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AP tennis:

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Account tweaks for young Instagram users ‘minimum’ expected by B.C., David Eby says

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SURREY, B.C. – Premier David Eby says new account control measures for young Instagram users introduced Tuesday by social media giant Meta are the “minimum” expected of tech companies to keep kids safe online.

The parent company of Instagram says users in Canada and elsewhere under 18 will have their accounts set to private by default starting Tuesday, restricting who can send messages, among other parental controls and settings.

Speaking at an unrelated event Tuesday, Eby says the province began talks with social media companies after threatening legislation that would put big tech companies on the hook for “significant potential damages” if they were found negligent in failing to keep kids safe from online predators.

Eby says the case of Carson Cleland, a 12-year-old from Prince George, B.C., who took his own life last year after being targeted by a predator on Snapchat, was “horrific and totally preventable.”

He says social media apps are “nothing special,” and should be held to the same child safety standards as anyone who operates a place that invites young people, whether it’s an amusement park, a playground or an online platform.

In a progress report released Tuesday about the province’s engagement with big tech companies including Google, Meta, TikTok, Spapchat and X, formerly known as Twitter, the provincial government says the companies are implementing changes, including a “trusted flagger” option to quickly remove intimate images.

— With files from The Associated Press

This report by The Canadian Press was first published Sept. 17, 2024

The Canadian Press. All rights reserved.



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