Economy

Canadian dollar gains as greenback’s rally fizzles

Published

4 years ago

February 18, 2021

By Fergal Smith

TORONTO (Reuters) – The Canadian dollar strengthened against its U.S. counterpart on Thursday as the greenback broadly declined, but the loonie stuck within its recent range as investors weighed the impact of higher U.S. bond yields on currency markets.

The Canadian dollar was 0.2% higher at 1.2672 to the greenback, or 78.91 U.S. cents, having traded in a range of 1.2665 to 1.2730. Last month, it touched its highest in nearly three years at 1.2586.

“The Canadian dollar is rangebound, albeit with a modest firming bias,” Rahim Madhavji, president at KnightsbridgeFX.com said in a note. “The tug of war between the Fed and bond traders is ongoing.”

U.S. long-term bond yields have scaled one-year highs this week in anticipation of an economic recovery, boosting the U.S. dollar against a basket of major currencies. But the greenback gave back some of those gains on Thursday, pressured by disappointing labor market data.

Canadian yields have also moved higher, signaling the economy needs less support than it did in 2020, strategists say, as investors become more confident that a successful rollout of COVID-19 vaccines will eventually boost activity and inflation.

The 10-year yield touched its highest since March last year at 1.160% before dipping to 1.148%, up 3.8 basis points on the day.

The price of oil, one of Canada‘s major exports, fell despite a sharp drop in U.S. crude inventories, as market participants took profits following days of buying spurred by a cold snap in Texas. U.S. crude prices settled 1% lower at $60.52 a barrel.

Canada lost 231,200 jobs in January, the largest decrease since May last year, a report from payroll services provider ADP showed. December data was revised to show an increase of 338,200 jobs rather than a decline of 28,800.

Canada‘s retail sales report for December is due on Friday.

(Reporting by Fergal Smith; Editing by Andrea Ricci and Sam Holmes)

Economy

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

Published

3 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

3 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

4 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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