adplus-dvertising
Connect with us

News

Inflation rate dropped to 3.4% in May. What that means for the Bank of Canada

Published

 on

The annual rate of inflation dropped sharply last month, but some economists argue a slowdown might not be enough to deter the Bank of Canada from another rate hike in July.

Statistics Canada said Tuesday that the annual inflation rate for May cooled by a full percentage point to 3.4 per cent.

Most economists had the headline inflation rate dropped significantly last month after reaching 4.4 per cent in April — a surprise uptick from 4.3 per cent the previous month and the first time the inflation rate rose in 10 months.

RBC Economics had expected a more modest drop to 3.6 per cent in the May inflation report.

Nathan Janzen, assistant chief economist at RBC, tells Global News the “biggest factor” is the difference in energy price trends this year compared to last. Energy prices were down 12.4 per cent year-over-year in May, according to Statistics Canada.

Prices for gasoline and oil spiked in the spring and summer of 2022 following Russia’s invasion of Ukraine. Janzen explains that with those price increases falling out of the annual inflation data, the year-to-year price growth will be diminished as a result.

Meanwhile, Statistics Canada said grocery price inflation remained elevated, rising 9.0 per cent year-over-year, a figure that was nearly unchanged from April.

Prices of edible fats and oils saw a 20.3 per cent jump, while costs were up 15 per cent for bakery products and 13.6 per cent higher for cereals, according to the agency.

Inflation on food purchased from restaurants accelerated in May, StatCan said, amid ongoing labour shortages feeding into service-sector employers.

Reports of ongoing food inflation pressures in May come the same day the Competition Bureau released the results of its probe into concentration in Canada’s grocery sector, which found a lack of competition is driving prices higher.

Rising mortgage costs tied to the Bank of Canada’s higher interest rates were once again the biggest contributor to the monthly CPI figures, StatCan said. The mortgage cost index rose 29.9 per cent annually, setting a new high for the largest increase on record for the third consecutive month.

Prices for cellular services meanwhile dropped 8.8 per cent year-over-year, the biggest decline since April 2022. Furniture prices were also down 2.9 per cent, and the 3.2 per cent price increase for passenger vehicles was the smallest increase since February 2021.

What will the Bank of Canada do?

Janzen says Tuesday’s CPI release is a “very significant report” for the Bank of Canada in weighing whether it needs to deliver another shock to the economy with a second consecutive rate hike in July.

He says that the Bank of Canada won’t pay too much heed to the decline in the annual figures because of how much it’s tied to last year’s higher prices. Instead, he says policymakers will pay closer attention to the shorter-term monthly trends and the central bank’s preferred “core measures” of inflation in deciding whether enough steam has been taken out of price pressures.

The Bank of Canada’s preferred measures for CPI-median and CPI-trim declined modestly from April to May, though they remain elevated at 3.9 per cent and 3.8 per cent, respectively.

More on Money

CIBC senior economist Andrew Grantham said that these metrics continue to “run hotter,” but declined below the consensus of economists’ expectations — that might sway the central bank to “wait a little longer” than July before delivering another possible interest rate hike.

Janzen notes that inflation tends to be a “lagging indicator” — showing the results of what’s already come to pass in the economy.

“Every inflation metric remains far above the two per cent inflation target,” Benjamin Reitzes, BMO’s managing director of Canadian rates and macro strategist, said in a note Tuesday. “Accordingly, Bank of Canada policymakers won’t breathe a huge sigh of relief after this report as core inflation remains sticky and has yet to show signs of a durable slowdown.”

Randall Bartlett, senior director of Canadian Economics, echoed this sentiment.

“We continue to be of the view that the Bank of Canada will hike by another 25 basis points in July, while leaving the door open to further tightening if the data fails to cooperate over the summer,” he said in a report Tuesday.

Other economic releases in the calendar ahead of the July 12 rate decision such as the June jobs report and the Bank of Canada’s own business outlook survey will inform whether it’s done enough to keep bringing inflation down all the way to the two per cent mark.

“Those are all indicators that they’ll use to tell them where inflation is going in the future, not just where it is today,” he says.

Janzen adds that there will have to be significant signs of slowing in these economic releases for the Bank of Canada to return to its pause. If policymakers didn’t think 425 basis points of policy rate tightening was enough, he says it’s not likely an extra 25 basis points will satisfy the central bank that inflation is set to return to two per cent.

728x90x4

Source link

Continue Reading

News

Bad traffic, changed plans: Toronto braces for uncertainty of its Taylor Swift Era

Published

 on

TORONTO – Will Taylor Swift bring chaos or do we all need to calm down?

It’s a question many Torontonians are asking this week as the city braces for the arrival of Swifties, the massive fan base of one of the world’s biggest pop stars.

Hundreds of thousands are expected to descend on the downtown core for the singer’s six concerts which kick off Thursday at the Rogers Centre and run until Nov. 23.

And while their arrival will be a boon to tourism dollars — the city estimates more than $282 million in economic impact — some worry it could worsen Toronto’s gridlock by clogging streets that already come to a standstill during rush hour.

Swift’s shows are set to collide with sports events at the nearby Scotiabank Arena, including a Raptors game on Friday and a Leafs game on Saturday.

Some residents and local businesses have already adjusted their plans to avoid the area and its planned road closures.

Aahil Dayani says he and some friends intended to throw a birthday bash for one of their pals until they realized it would overlap with the concerts.

“Something as simple as getting together and having dinner is now thrown out the window,” he said.

Dayani says the group rescheduled the gathering for after Swift leaves town. In the meantime, he plans to hunker down at his Toronto residence.

“Her coming into town has kind of changed up my social life,” he added.

“We’re pretty much just not doing anything.”

Max Sinclair, chief executive and founder of A.I. technology firm Ecomtent, suggested his employees avoid the company’s downtown offices on concert days, saying he doesn’t see the point in forcing people to endure potential traffic jams.

“It’s going to be less productive for us, and it’s going to be just a pain for everyone, so it’s easier to avoid it,” Sinclair said.

“We’re a hybrid company, so we can be flexible. It just makes sense.”

Swift’s concerts are the latest pop culture moment to draw attention to Toronto’s notoriously disastrous daily commute.

In June, One Direction singer Niall Horan uploaded a social media video of himself walking through traffic to reach the venue for his concert.

“Traffic’s too bad in Toronto, so we’re walking to the venue,” he wrote in the post.

Toronto Transit Commission spokesperson Stuart Green says the public agency has been working for more than a year on plans to ease the pressure of so many Swifties in one confined area.

“We are preparing for something that would be akin to maybe the Beatles coming in the ‘60s,” he said.

Dozens of buses and streetcars have been added to transit routes around the stadium, and the TTC has consulted the city on potential emergency scenarios.

Green will be part of a command centre operated by the City of Toronto and staffed by Toronto police leaders, emergency services and others who have handled massive gatherings including the Raptors’ NBA championship parade in 2019.

“There may be some who will say we’re over-preparing, and that’s fair,” Green said.

“But we know based on what’s happened in other places, better to be over-prepared than under-prepared.”

Metrolinx, the agency for Ontario’s GO Transit system, has also added extra trips and extended hours in some regions to accommodate fans looking to travel home.

A day before Swift’s first performance, the city began clearing out tents belonging to homeless people near the venue. The city said two people were offered space in a shelter.

“As the area around Rogers Centre is expected to receive a high volume of foot traffic in the coming days, this area has been prioritized for outreach work to ensure the safety of individuals in encampments, other residents, businesses and visitors — as is standard for large-scale events,” city spokesperson Russell Baker said in a statement.

Homeless advocate Diana Chan McNally questioned whether money and optics were behind the measure.

“People (in the area) are already in close proximity to concerts, sports games, and other events that generate massive amounts of traffic — that’s nothing new,” she said in a statement.

“If people were offered and willingly accepted a shelter space, free of coercion, I support that fully — that’s how it should happen.”

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



Source link

Continue Reading

News

‘It’s literally incredible’: Swifties line up for merch ahead of Toronto concerts

Published

 on

TORONTO – Hundreds of Taylor Swift fans lined up outside the gates of Toronto’s Rogers Centre Wednesday, with hopes of snagging some of the pop star’s merchandise on the eve of the first of her six sold-out shows in the city.

Swift is slated to perform at the venue from Thursday to Saturday, and the following week from Nov. 21 to Nov. 23, with concert merchandise available for sale on some non-show days.

Swifties were all smiles as they left the merch shop, their arms full of sweaters and posters bearing pictures of the star and her Eras Tour logo.

Among them was Zoe Haronitis, 22, who said she waited in line for about two hours to get $300 worth of merchandise, including some apparel for her friends.

Haronitis endured the autumn cold and the hefty price tag even though she hasn’t secured a concert ticket. She said she’s hunting down a resale ticket and plans to spend up to $600.

“I haven’t really budgeted anything,” Haronitis said. “I don’t care how much money I spent. That was kind of my mindset.”

The megastar’s merchandise costs up to $115 for a sweater, and $30 for tote bags and other accessories.

Rachel Renwick, 28, also waited a couple of hours in line for merchandise, but only spent about $70 after learning that a coveted blue sweater and a crewneck had been snatched up by other eager fans before she got to the shop. She had been prepared to spend much more, she said.

“The two prized items sold out. I think a lot more damage would have been done,” Renwick said, adding she’s still determined to buy a sweater at a later date.

Renwick estimated she’s spent about $500 in total on “all-things Eras Tour,” including her concert outfit and merchandise.

The long queue for Swift merch is just a snapshot of what the city will see in the coming days. It’s estimated that up to 500,000 visitors from outside Toronto will be in town during the concert period.

Tens of thousands more are also expected to attend Taylgate’24, an unofficial Swiftie fan event scheduled to be held at the nearby Metro Toronto Convention Centre.

Meanwhile, Destination Toronto has said it anticipates the economic impact of the Eras Tour could grow to $282 million as the money continues to circulate.

But for fans like Haronitis, the experience in Toronto comes down to the Swiftie community. Knowing that Swift is going to be in the city for six shows and seeing hundreds gather just for merchandise is “awesome,” she said.

Even though Haronitis hasn’t officially bought her ticket yet, she said she’s excited to see the megastar.

“It’s literally incredible.”

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

The Canadian Press. All rights reserved.



Source link

Continue Reading

News

Via Rail seeks judicial review on CN’s speed restrictions

Published

 on

OTTAWA – Via Rail is asking for a judicial review on the reasons why Canadian National Railway Co. has imposed speed restrictions on its new passenger trains.

The Crown corporation says it is seeking the review from the Federal Court after many attempts at dialogue with the company did not yield valid reasoning for the change.

It says the restrictions imposed last month are causing daily delays on Via Rail’s Québec City-Windsor corridor, affecting thousands of passengers and damaging Via Rail’s reputation with travellers.

CN says in a statement that it imposed the restrictions at rail crossings given the industry’s experience and known risks associated with similar trains.

The company says Via has asked the courts to weigh in even though Via has agreed to buy the equipment needed to permanently fix the issues.

Via said in October that no incidents at level crossings have been reported in the two years since it put 16 Siemens Venture trains into operation.

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

Companies in this story: (TSX:CN)

The Canadian Press. All rights reserved.



Source link

Continue Reading

Trending