Economy

Canadian dollar gains as Bank of Canada’s outlook supports further taper

Published

3 years ago

June 9, 2021

The Canadian dollar strengthened against its U.S. counterpart on Wednesday, as U.S. bond yields fell and the Bank of Canada‘s economic outlook supported expectations for further dialing back of stimulus in the coming quarter.

The Bank of Canada left unchanged its key interest rate at a record low 0.25% and the pace of its quantitative easing, as expected. It said the economy would “rebound strongly” as vaccinations against COVID-19 picked up.

“A further taper in QE is likely in July as the growth outlook improves further and becomes more certain,” said Ryan Brecht, a senior economist at Action Economics.

In April, the BoC became the first major central bank to cut back on pandemic-era money-printing stimulus programs.

In contrast, investors bet that the Federal Reserve is some way off tapering its stimulus, weighing on U.S. bond yields and the U.S. dollar.

The Canadian dollar was trading 0.2% higher at 1.2086 to the greenback, or 82.74 U.S. cents, having traded in a range of 1.2058 to 1.2117. Last week, it touched a six-year high at 1.2007, bolstered by soaring commodity prices.

The price of oil, one of Canada‘s major exports, was boosted on Wednesday by signs of strong fuel demand in Western economies and fading prospects of Iranian supplies returning. U.S. crude prices rose 0.2% to $70.36 a barrel.

Canadian government bond yields were lower across a flatter curve, tracking the move in U.S. Treasuries. The 10-year fell as much as 5 basis points to 1.403%, its lowest level since March 11.

(Reporting by Fergal Smith; Editing by Will Dunham and Jonathan Oatis)

Economy

PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

Published

4 days ago

October 17, 2024

Anne Joseph

OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

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

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Economy

Statistics Canada says levels of food insecurity rose in 2022

Published

5 days ago

October 16, 2024

Anne Joseph

OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

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Economy

Statistics Canada says manufacturing sales fell 1.3% to $69.4B in August

Published

5 days ago

October 16, 2024

Anne Joseph

OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.

The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.

The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.

Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.

Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.

Overall manufacturing sales in constant dollars fell 0.8 per cent in August.

This report by The Canadian Press was first published Oct. 16, 2024.

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