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German Factory Orders Fall as Economy Faces Ukraine War Fallout – Financial Post

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(Bloomberg) — German factory orders fell for the first time in four months in the runup to Russia’s invasion of Ukraine, underscoring concerns over slower growth in Europe’s largest economy. 

Demand declined 2.2% in February from the previous month, driven by a slump in foreign orders. That’s worse than all but one prediction in a Bloomberg survey of economist, which saw a median estimate of a 0.3% drop. 

Expectations for Germany’s economic recovery have been slashed after the war in Ukraine sent energy prices higher while disrupting supply chains that had already been suffering from pandemic-related snarls. 

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A panel of advisers to Chancellor Olaf Scholz last week lowered its growth projection to 1.8% from 4.6% for this year, while warning that a recession is possible because of the country’s high dependence on Russian energy. Inflation reached 7.6% in March — the highest level since records began after reunification in the early 1990s. 

Companies including BMW AG, BASF SE and ThyssenKrupp AG have already warned that their earnings will slip. On Monday, Deutsche Bank AG Chief Executive Officer Christian Sewing said a recession “would presumably be inevitable” if Germany was cut off from deliveries of Russian oil and natural gas. 

Before the invasion, the economy had been grappling with the latest wave of the pandemic. Restrictions have now been loosened, though the caseload remains elevated and Health Minster Karl Lauterbach has urged citizens to remain cautious. 

©2022 Bloomberg L.P.

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

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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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Statistics Canada says levels of food insecurity rose in 2022

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

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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.

The Canadian Press. All rights reserved.

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