The odds of further rate hikes from the Bank of Canada shrink dramatically after consumer price index cools
Canada’s inflation rate cooled more than expected in September to an annual pace of 3.8 per cent in a broad-based easing that economists say should give the Bank of Canada reason to hold interest rates when it meets next week.
The reading released by Statistics Canada on Oct. 17, was the first slowdown in the consumer price index since prices reaccelerated in July and August and came in lower than economists’ estimates of four per cent.
Inflation slowed in a number of categories including cell services, cleaning products, furniture/textiles and recreational vehicles, BMO economist Benjamin Reitzes said in a note.
Food prices also showed signs of easing, rising 5.8 per cent year over year compared with 6.9 per cent in August.
CPI is still riding well above the Bank of Canada’s two per cent inflation target, but today’s numbers showed that higher interest rates are starting to do their job, said Andrew Grantham of CIBC Economics.
“There were signs within today’s release that the weakening of domestic demand is now starting to impact pricing in some areas and should continue to do so moving forward,” Grantham said.
Here’s what the economists are saying about the latest inflation numbers and what they mean for the Bank of Canada and interest rates.
“With the Business Outlook Survey pointing to ongoing struggles for the economy (which saw GDP flat-line in the six months to July), and inflation coming in below expected, look for expectations to solidify around the BoC holding policy steady next week. The level of inflation remains much too high for comfort, but the trend is the BoC’s friend here. Given that inflation is the most lagging of indicators, and the economy is clearly weakening, we’re likely to see ongoing disinflationary pressure…there’s no need for further rate hikes in Canada.”
“With today’s inflation print, the BoC is now equipped with all relevant data before making their policy decision next week. Alongside other measures that have shown momentum in cooling in Canada’s economy, we see enough evidence for the BoC to stand on the sidelines next week, holding the policy rate at five per cent.”
“With gasoline prices falling so far in October, in contrast to a sharp acceleration seen during the same month a year ago, headline inflation should ease further next month and print close to the upper bound of the Bank of Canada’s one to three per cent target range. Even though the Bank’s core measures of inflation remain too high for their liking,
some of the details within today’s report, combined with the stall in economic activity seen during Q2 and Q3, should give policymakers comfort that inflation will continue to ease back to two per cent without the need for further interest rate hikes.”
“The larger-than-expected falls in headline and core inflation in September should be enough to finally persuade markets that there is little chance of the Bank of Canada raising interest rates again in this cycle.
“The September CPI release at least confirms that the earlier surge in core inflation was a blip and reinforces our view that the Bank’s next move is likely to be an interest rate cut.”
“After taking a worrying hiatus in July and August, the disinflationary process looks like it is back underway in Canada. Markets got the message immediately, repricing the odds of a November rate hike from nearly 50 per cent down to below 20 per cent in the hour after Statistics Canada’s data on inflation was published. Along with the global tightening in long rates, this print gives the Bank of Canada a window to allow the lagged impact of interest rate hikes to dampen demand and continue the disinflation process without maintaining an aggressive tightening bias. But, with recessionary pressure building across the economy, the central bank should begin to weigh the risks of staying tight for too long.”
“The slower increase in Canadian consumer prices in September was a step in the right direction. It was also long overdue, given persistent signs of cooling in labour market conditions as well as in consumer spending data. Yesterday’s release of the Bank of Canada quarterly business and consumer surveys further highlighted softening sentiment among both businesses and consumers in Q3, with both groups acknowledging that further slowing in spending and growth can be expected in quarters ahead. Indeed, the lagged impact of interest rate hikes to date will continue to exert downward pressure on consumer spending as debt payments rise as a share of household incomes, making it more challenging for businesses to raise prices as fast and as frequent. With more easing in inflation readings expected in the months ahead, we expect the Bank of Canada to stay on pause through the rest of the year.”
“We think the September data will take a lot of pressure off the Bank of Canada to do more.
“It would be perilous for the Bank of Canada to remain focused on sticky inflation with real policy rate the most restrictive since 2008, given the lag in transmitting monetary policy to the economy, and even longer for inflation.”
Religious persecution
Misguided religious and cultural traditions
Fear of those who challenge the established order
Long ago a horrid thing happened in Europe and in many European Colonies. It was called the Inquisition, an instrument of the Catholic Church and used by the present-day public authorities to quell political and social protest and challenges from those considered rebels(Heretics).
In that day the Church of Rome was seen as the very roots of Western society, that which kept society on a path of righteousness and functioning practice. The political rulers of the day, kings, nobles and lords allied themselves to the church with absolute reason for doing so. The church kept them in power you see. There was a hierarchy prescribed to the present-day society where authority flowed from God to the Pope, Noblemen, Cardinals, and Priests to the public. Church law was often edited for the benefit of the higher classes. Therefore rebels standing against local or regional lords were viewed as heretics who stood against the wishes of the pope, church laws and God himself. This church-established a council of the Inquisition roamed Europe looking for heretics, those different, rebels, witches and those in league with the devil. Any form of social, cultural or political wrongdoing was dealt with with a heavy hand. The rich may have been accused of a wrongdoing, but able to seek their freedom through financial donations. The poor faced the Inquisition with terror and fear since no one was there to represent them. The church-Lord alliance maintained the most severe of punishments.
The Inquisition evolved into the massive witch-hunting movement. Millions of people perished having been accused of witchcraft and being in League with the Devil. There actually existed witch hunters who simply went to a village, watching who was odd, different, threatening to the authorities and voila, a witch was found and declared. Strange methods of finding a witch were developed. One involved sticking a pin into the back side of a person, usually a woman and if she did not cry out in pain, she was possibly a candidate for interrogation. The interrogators usually got a confession leading to that person’s death.
There exists today religious authorities with similar powers to prosecute and punish those deemed different or contrary to established religious or cultural practices. Arrest, torture and disappearances happen daily in places such as Iran, Saudi Arabia, and many African Nations. Fanatical Religious Dogma has cost millions of people their lives, and for what? The Acquisition and use of power. Power encompasses every aspect of control of others whether it be through intellect, threat or violence.
Never should such horrors happen in a civilized world. Just one question needs to be asked. Do we live in a civilized world?
Steven Kaszab
Bradford, Ontario
skaszab@yahoo.ca
TORONTO – An arbitrator has awarded Ontario’s doctors a nearly 10-per-cent compensation increase for the first year of their new Physician Services Agreement.
The province is in the midst of negotiations with the Ontario Medical Association for the four-year agreement, but an arbitrator was tasked with setting increases for the first year, while the two sides work on the 2025-2028 period.
The OMA had proposed a five-per-cent general increase plus 10.2 per cent as a catch up to account for inflation, while the government proposed three per cent.
Arbitrator William Kaplan concluded that while the OMA’s target was unprecedented, the government’s suggested three per cent was “completely unrealistic.”
He writes that other health-care workers like nurses have received far more for the same time period, and they do not have to pay the overhead costs of running a practice out of their compensation, as doctors do, so he awarded a three-per-cent general increase plus a “catch up” of 6.95 per cent.
The Ministry of Health’s arbitration arguments angered doctors, as the government wrote that recruitment and retention of doctors was “not a major concern” and there was “no concern of a diminished supply of physicians.”
Kaplan wrote that there is a physician shortage.
“Somewhere between 1.35 million and 2.3 million people in the province are not attached to a family doctor,” the arbitration decision said.
“These are real numbers. The Ministry’s own documents – which we ordered disclosed – demonstrate that there is a problem to address.”
Kaplan cites a ministry document that showed the growth rate for family doctors was 1.4 per cent, which was below the growth rate for the population, at 1.6 per cent.
“What was being said, in other words, in the Ministry’s words, in this Ministry document, was that the problem is structural: the number of new family doctors needs to significantly exceed population growth and until and unless it begins to do so, the attachment problem will persist and deteriorate.”
The OMA said in a statement that while it is encouraged by the award, there is still much to be done to address the fact that more than two million Ontarians do not have a family doctor.
“The OMA also remains concerned about access to care, particularly in northern and rural Ontario, and ensuring that specialist consults, surgeries, and diagnostic tests are provided to patients in a timely manner so that people receive the best outcome possible,” the group wrote.
Health Minister Sylvia Jones said in a statement that the agreement also provides for specific funding to be allocated to “targeted investments” to help enhance and connect people to primary care.
“This agreement builds on the $17.5 billion the province currently spends to connect people to family doctors, primary care and other services across the province, 50 per cent more than when we took office in 2018,” she wrote.
This report by The Canadian Press was first published Sept. 13, 2024.
The Canadian Press. All rights reserved.
TORONTO – Ongoing controversy over the documentary “Russians at War” has brought scrutiny to Ontario’s public broadcaster, which has said it will not air the film it helped fund.
One media expert says TVO is getting “the worst of all worlds” by investing in a project that can no longer be shown or monetized.
“TVO created a thing which their audience doesn’t get to see, other audiences will get to see and they’ve footed the bill and gotten no reward for it,” Chris Arsenault, chair of Western University’s master of media in journalism and communication program, said in an interview.
“I can’t think of a worse outcome for a network than what’s happened.”
“Russians at War,” a film rebuked by the Ukrainian community and some Canadian politicians, was part of the Toronto International Film Festival’s lineup until organizers suspended all screenings this week due to “significant threats” to festival operations. It shows the disillusionment of some Russian soldiers on the front lines of the war in Ukraine.
TVO had planned to air the story in the coming months, but the network’s board of directors withdrew support for the film on Tuesday, citing feedback it received. The Ukrainian Canadian Congress, Ukraine’s consul-general in Toronto and others have called the film Russian propaganda and a “whitewashing” of Russian military war crimes in Ukraine – claims the film’s producers and TIFF have rejected.
The TVO board’s announcement came just days after the network defended the film as “antiwar” at its core. It was an about-face the Documentary Organization of Canada said “poses a serious threat” to media independence and raises questions about political interference.
TVO has not responded to requests for comment and board chair Chris Day declined to elaborate on the decision to pull the film.
“Suffice it to say, we heard significant concerns and we responded,” Day wrote to The Canadian Press in an emailed response to an interview request.
Arsenault, who has not seen the documentary and could not comment on its content, said he’s nevertheless worried about the spectre of board intervention in independent editorial decisions, which he said “opens the doors” to further meddling in the production of documentaries and journalism.
“Russians at War,” a Canada-France co-production, was funded in part by the Canada Media Fund, which provided $340,000 for the project through its broadcaster envelope program. A spokesperson for the fund said TVO independently chose to use that money to support the production of the documentary.
One of the film’s producers, Cornelia Principe, said that TVO also had to pay a licensing fee to air the documentary. Such fees can range from $50,000 to $100,000, she said.
Principe, who has defended the documentary and its Canadian-Russian director Anastasia Trofimova, said she was shocked by the TVO board’s decision.
“Anastasia and I have been working with TVO on this for two and a half years.… I was a little bit out of it for hours. I just couldn’t believe it.”
What happens next, she said, is “uncharted territory” for TVO.
“This has, as far as I know, never happened before,” said Principe, who has worked with the broadcaster on various documentaries over the years.
TVO’s board has said the network will be “reviewing the process by which this project was funded and our brand leveraged.”
Ontario’s Minister of Education Jill Dunlop said in a statement that the decision made by TVO’s board of directors “was the right thing to do,” but did not elaborate.
As a non-profit government agency, TVO has a mandate to distribute educational materials and programs but the ministry is not involved with its broadcasting arm due to CRTC licensing rules.
Another public broadcaster, British Columbia’s Knowledge Network, has confirmed that it made a licence fee contribution of $15,000 for “Russians at War” so that it can be a “second window” broadcaster for the film.
Asked whether the documentary will still air at some point in British Columbia, a spokesperson for the network said it’s “working on a public response.”
Finance Minister and Deputy Prime Minister Chrystia Freeland has denounced the use of public funds for “Russians at War,” saying she shares the “grave concerns” Ukrainian officials and community members in Canada have raised about the film.
The Ukrainian Canadian Congress has said it will keep protesting “Russians in War” since TIFF has said it will still screen the doc at some point. A demonstration in downtown Toronto was set to get underway Friday afternoon.
“Russians at War” is scheduled to screen at the Windsor International Film Festival, running from Oct. 24 to Nov. 3. The festival announced Friday that the documentary is among 10 nominees for its WIFF Prize in Canadian Film, worth $25,000.
— With files from Queen’s Park correspondent Allison Jones in Toronto.
This report by The Canadian Press was first published Sept. 13, 2024.
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