Winter weather conditions may remain on the forecast for most of the country during the coming weeks, but from a U.S. economic perspective, it’s finally beginning to feel like spring. That may be due in part to changes that come from a new administration, shifting priorities, and fresh perspectives.
But this economic thaw is much more than just a financial uptick. It’s a confluence of several positive factors coming together at one time that’s driving greater optimism than we’ve seen in the last several difficult months. If these trends continue in the right direction, we may be in store for a vibrant springtime for the American economy.
Managing Covid-19 & Passing Economic Stimulus
In order to return to normalcy, getting the pandemic under control will be key. Bold and bipartisan action is essential to address the health and economic crises continuing to face the U.S.
First – we must, in a bipartisan way, do all we can to maximize the vaccination effort. This is essential to establishing any short-, medium- or long-term goals for our citizens and our economy.
Second – while politics always plays a role in determining the size and scope of stimulus packages, this iteration needs special consideration as the cause is very different from past financial crises. Parts of our economy are, in fact, hurting and need support, and we must also keep a focus on prudent fiscal and monetary policies that work together without causing significant future structural financial imbalances.
Supporting Small Businesses & Working Americans
An essential component of that stimulus will be supporting American small businesses, which still face an uphill battle in the coming months. The Paycheck Protection Program (PPP) played a critical role in supporting small businesses, allowing organizations like ours to assist small business owners in receiving the federal funding they needed to survive. The Treasury Department estimated PPP loans supported 51 million American jobs through the program’s close on August 8th, 2020. The launch of the second round of PPP – through which the Small Business Administration has already approved 1.3 million loans totaling over $100 billion – is another lifeline, and we are continuing to help those in need.
But according to the Federal Reserve, sales for nearly 90% of small businesses have not yet returned to pre-pandemic levels. As many as 64% would apply for another round of government aid if it were offered – and an astonishing 39% of that group expected they would be unlikely to remain in business without further assistance. Continued support will be essential to keep the lights on for those small businesses.
Rebuilding America’s Infrastructure
One bright spot on the horizon may be the restoration of America’s roads, bridges, mass transit and other infrastructure works. This effort will help build up our communities to 21st century standards and support local economies. The increase in electric vehicle use, for example, will require building hundreds of thousands of charging stations across the country. Collectively, these efforts could create millions of good-paying jobs and untold investment dollars, catalyzing serious economic activity.
I’m optimistic these efforts will be greatly beneficial for the U.S. economy going forward in 2021. With the number of available jobs on job-search site Indeed returning to pre-pandemic levels in January, hiring could begin to normalize in the coming weeks. As long as we are able to keep Americans safe and healthy as we continue to battle Covid-19 and ensure that pent-up demand and economic stimulus don’t negatively impact interest rates, we could expect to see the American economic engine blooming in the coming months.
Toronto Stock Exchange rises 0.64% to 19,310.74
* The Toronto Stock Exchange’s TSX rises 0.64 percent to 19,310.74
* Leading the index were Ero Copper Corp <ERO.TO>, up 13.6%, Nexgen Energy Ltd, up 12.6%, and Denison Mines Corp, higher by 10.5%.
* Lagging shares were Kinaxis Inc, down 5.2%, Ballard Power Systems Inc, down 3.9%, and Cominar REIT, lower by 3.5%.
* On the TSX 132 issues rose and 93 fell as a 1.4-to-1 ratio favored advancers. There were 30 new highs and 1 new low, with total volume of 246.0 million shares.
* The most heavily traded shares by volume were Enbridge Inc, Suncor Energy Inc and Manulife Financial Corp.
* The TSX’s energy group rose 3.28 points, or 2.7%, while the financials sector climbed 2.69 points, or 0.8%.
* West Texas Intermediate crude futures fell 0.58%, or $0.38, to $65.31 a barrel. Brent crude fell 0.29%, or $0.2, to $68.68.
* The TSX is up 10.8% for the year.
This summary was machine generated May 5 at 21:03 GMT.
Merkel wants Europe, United States to aim for new trade deal
BERLIN (Reuters) – A trade agreement between the United States and the European Union would “make a lot of sense”, German Chancellor Angela Merkel said in a speech in which she welcomed the United States’ return to the multilateral fold under President Joe Biden.
German enthusiasm for a trade deal and stronger transatlantic ties may have to contend with a more cautious approach in France, where President Emmanuel Macron has made a priority of reducing European reliance on rival superpowers.
Merkel said that while Germany had no interest in a world divided into camps as it was in the Cold War, it was good that the United States, Europe’s “most important ally”, stood alongside Europe in rivalries with China and Russia.
“I have always supported a trade agreement between the United States of America and the European Union,” she told a Berlin conference on the future of transatlantic ties.
“We have trade agreements with so many of the world’s regions. It would make a lot of sense to develop such a trade agreement here, similar to what we have done with Canada,” she added.
Merkel’s transatlantic coordinator Peter Beyer told Reuters in February that Germany and the new U.S. administration should “think big” and aim for an ambitious agenda including a trade deal to abolish industrial tariffs and a WTO reform to increase pressure on China.
The European Union has put reform of the World Trade Organization at the heart of its trade strategy for the next decade, saying global rules on commerce must be greener, take more account of state subsidies and be enforced.
The EU itself feels bruised by trade wars, Brexit and what it sees as unfair competition from China, which it perceives as a “systemic rival”, and is taking more assertive measures to enforce global trade rules and ensure a level playing field.
Merkel said that despite issues with its ratification in the EU, the bloc’s planned investment agreement with China, the comprehensive agreement on investment (CAI), is a “very important undertaking, because it gives us more reciprocity in market access”.
At the same time, it was necessary to address “the whole range of issues” with China, including its human rights record, she added.
The EU executive has hailed the CAI, struck at the very end of 2020, as a means to secure better access for European companies to Chinese markets and redress unbalanced economic ties.
But concerns over China’s human and labour rights record and scepticism from the United States had already cast doubt on the deal’s approval process even before Chinese blacklisting of five members of the European Parliament in tit-for-tat sanctions.
(Reporting by Thomas Escritt, Paul Carrel and Michael Nienaber; EDiting by Giles Elgood)
Canadian dollar posts three-year high as risk appetite climbs
By Fergal Smith
TORONTO (Reuters) – The Canadian dollar strengthened to its highest level in more than three years against its U.S. counterpart on Wednesday, supported by improved investor sentiment and the Bank of Canada‘s recent shift to more hawkish guidance.
The Dow Jones Industrial Average hit a record high as the market recovered from a steep tech sell-off, after investors were encouraged by U.S. Treasury Secretary Janet Yellen’s new comments on interest rates and a positive private jobs report.
“Risk-on conditions” and the recent move higher in commodity prices bolstered the Canadian dollar,” Ronald Simpson, managing director, global currency analysis at Action Economics, said in a note. “In addition, the BoC’s tapering of its QE program appears to have shifted USD-CAD’s trading range down a notch.”
Last month, the Bank of Canada cut the pace of its bond purchases and signaled it could hike interest rates in late 2022.
Further clues to the central bank’s policy outlook could come from Canada‘s April employment report, due for release on Friday.
The Canadian dollar was trading 0.2% higher at 1.2280 to the greenback, or 81.43 U.S. cents, having touched its strongest intraday level since February 2018 at 1.2252.
U.S. crude oil futures settled 0.1% lower at $65.63 a barrel as traders used weekly inventory figures as an excuse to pull back from the recent rally. Oil is one of Canada‘s major exports.
Home sales in Toronto, Canada‘s most populous city, fell nearly 13% in April from March. That bucked the regular spring trend, as demand began to ease after months of blistering growth.
Canadian government bond yields were mixed across the curve, with the 10-year little changed at 1.521%.
(Reporting by Fergal Smith; Editing by Kirsten Donovan and Nick Zieminski)
Canada sends medical supplies to India as COVID-19 overwhelms country’s health care – Global News
Coronavirus: What's happening in Canada and around the world on Wednesday – CBC.ca
The latest news on COVID-19 developments in Canada for Wednesday, May 5, 2021 – moosejawtoday.com
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