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The Bank of Canada is warning Canadians to brace for a rough winter

Published

2 years ago

November 12, 2022

For years now, central banks around the world have helped consumers and businesses weather economic storms. In crisis after crisis, they cut interest rates to help people get through. They printed money and bought bonds to prop up markets.

This time, those same banks are actively making life more difficult.

“I’m sure some of this does feel a bit counterintuitive,” Bank of Canada governor Tiff Macklem said.

The Bank of Canada has raised interest rates six times since March. Rates have shot up from 0.25 per cent to 3.75 per cent. And the bank has warned it’s not done yet.

“We do think we still need to raise rates a little bit further,” Macklem told CBC News in an interview this week. “How far, we will see.”

In a wide-ranging interview, Bank of Canada governor Tiff Macklem tells CBC’s Peter Armstrong that Canadians should expect more interest rate hikes, and a mild recession is possible, as the central bank continues its fight against inflation.

The bank is raising rates now to rein in inflation that has reached its highest level in decades. Increasing rates is expected to slow the economy. So, Canadians who are already struggling to keep up with the rising cost of living are now facing higher borrowing costs. And those higher borrowing costs will drive down the economy.

“We actually think growth is going to be close to zero for the next few quarters, until about the middle of next year,” Macklem said.

He says that slowdown in economic activity should be short and not very deep. But it will have an impact.

“[The] unemployment rate is going to go up. We’re not talking about high unemployment rates that we’ve seen in past recessions, but it is going to go up,” he said.

‘People are frustrated’

Macklem says he understands how Canadians are feeling.

“People are frustrated. They feel helpless,” he said.

Canadian consumers aren’t the only ones who are frustrated. Economist Jim Stanford from the Canadian Centre for Policy Alternatives says the central bank has pushed rates too high, too quickly. Central banks around the world are looking at the current state of inflation, he said, and assuming both the cause and the solution are the same as the last inflation crisis in the 1970s and ’80s.

“Policy-makers at the Bank of Canada and the government and academia, I think, are unduly obsessed with what happened in the 1970s. It’s like a nightmare,” Stanford said in an interview with CBC News.

In the 1970s, real wages were rising along with prices. This time, real wages have fallen. In the 1970s, corporate profits were falling. Right now, corporate profits have surged to record levels.

“So this is the exact opposite of what we experienced in the 1970s. And pulling out a 50-year-old recipe and applying it again to today’s situation is absolutely inappropriate,” Stanford said.

He says the central bank should pause its relentless rate hikes and see if inflation really does need more of a push.

Headline inflation has slowed. Supply-chain issues are beginning to unwind. Global commodity costs have begun to fall.

New numbers won’t slow rate hikes: economist

The latest inflation numbers will be released on Nov. 16.

But RBC economist Claire Fan says this latest batch of numbers won’t do much to slow rate hikes.

“Consumer price growth in Canada likely ticked higher in October. We expect the annual rate to have risen to seven per cent, up from 6.9 per cent in September but still down from the 8.1 per cent recent peak in June,” Fan said in a note to clients.

She says a resurgence in gas and fuel oil prices was driving the increase, which should give the Bank of Canada enough reason to keep pushing rates higher.

How has inflation and the high cost of living impacted you? Tell us your story in an email to ask@cbc.ca or join us live in the comments below.

A rebound in the price of gasoline likely drove inflation higher again in October. (Joseph Prezioso/AFP/Getty Images)

“While there are signs that inflation is past its peak in Canada, it will likely take a sustained period of higher interest rates and a weaker economy for price growth to ease fully back to central bank target rates,” she wrote.

The RBC forecast assumes the bank will hike the rate by another 25 basis points in early December and then pause to assess the impact all of those rate hikes have had on the economy.

But it means anyone with a variable rate mortgage or a home equity line of credit is looking at yet another boost to their monthly payments.

‘We are getting closer’

Macklem says he knows these rate hikes are making life harder for many Canadians.

“We don’t want to make this more difficult than it has to be,” he said. “But at the same time, if we don’t do enough, if we’re half-hearted, Canadians are going to have to continue to endure the high inflation that is harming them every day.”

And that’s the risk here, analysts say. If the bank pauses too soon and finds inflation is still rising, it will have to take even more aggressive measures down the road. If it overshoots and keeps hiking once inflation is coming down in a sustainable way, then Canadians will needlessly suffer.

Macklem, left, speaks with CBC’s Peter Armstrong in Toronto on Thursday. (Evan Mitsui/CBC)

The window to get this right is getting smaller and smaller.

“We do think that there is a need for further increases, but we are getting closer to the end of this tightening cycle. I can’t tell you exactly what that is,” Macklem said.

“We’re not there yet. But we are getting closer.”

The good news is that Macklem believes we should be in a much better place by the middle of next year. The bad news is that the middle of next year is a long way off for anyone struggling to put food on their table or pay their mortgage payment today.

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Jacob Trouba says ‘there’s no animosity’ toward Rangers following trade rumors

Published

56 seconds ago

September 19, 2024

Anne Joseph

GREENBURGH, N.Y. (AP) — New York Rangers defenseman Jacob Trouba said Thursday “there’s no animosity” toward the organization following an offseason in which his name was prominently mentioned in trade rumors.

“It’s part of the business of hockey,” Trouba said following the first day of training camp for the reigning Presidents’ Trophy-winning Rangers.

According to reports, Rangers president and general manager Chris Drury had negotiated a trade that would send New York’s captain to Detroit in late June. The trade fell apart, however, when Trouba submitted his 15-team no-trade list to the Rangers on June 30 and included the Red Wings on it.

“Obviously, had the no-move that turned into the partial no-trade,” said Trouba, whom New York acquired in a trade with Winnipeg in June 2019 and signed to a seven-year, $56 million contract one month later. “That’s life, contracts, hockey business, whatever you want to call it.

“I knew that was coming that summer. It’s not by surprise. It was obviously something that was negotiated at the time.”

The 30-year-old’s insistence that his relationship with Drury is fine echoes what the executive said in a pre-training camp conference call with reporters.

“Jacob and I talk all the time as GM and captain should,” Drury said. “We’ve had a number of different conversations over the course of the summer on a lot of different things. He is very clear as to where he stands with me and what I think of him as a player and as a leader.”

Still, Trouba realizes that the 2024-25 season is likely the last for the current iteration of the Original Six franchise. The Rangers have qualified for the Stanley Cup Playoffs in each of the last three seasons, and have reached the Eastern Conference Finals in 2022 and 2024. Following last spring’s six-game series loss to the eventual Stanley Cup champion Florida Panthers, Drury wondered aloud in a conference call with reporters if the Rangers’ core players could lead the franchise to a Stanley Cup.

“(It’s) an opportunity that we have in front of us that in all likelihood will probably be the last crack for this core,” Trouba said. “I don’t think that’s a secret by any means. (A) group that’s kind of grown together, spent some years together here, and there’s something we want to accomplish.”

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Veterans Tyson Beukeboom, Karen Paquin lead Canada’s team at WXV rugby tournament

Published

4 mins ago

September 19, 2024

Anne Joseph

Veterans Tyson Beukeboom and Karen Paquin will lead Canada at the WXV 1 women’s rugby tournament starting later this month in the Vancouver area.

WXV 1 includes the top three teams from the Women’s Six Nations (England, France and Ireland) and the top three teams from the Pacific Four Series (Canada, New Zealand, and the United States).

Third-ranked Canada faces No. 4 France, No. 7 Ireland and No. 1 England in the elite division of the three-tiered WXV tournament that runs Sept. 29 to Oct. 12 in Vancouver and Langley, B.C. No. 2 New Zealand and the eighth-ranked U.S. make up the six-team WVX 1 field.

“Our preparation time was short but efficient. This will be a strong team,” Canada coach Kevin Rouet said in a statement. “All the players have worked very hard for the last couple of weeks to prepare for WXV and we are excited for these next three matches and for the chance to play on home soil here in Vancouver against the best rugby teams in the world.

“France, Ireland and England will each challenge us in different ways but it’s another opportunity to test ourselves and another step in our journey to the Rugby World Cup next year.”

Beukeboom serves as captain in the injury absence of Sophie de Goede. The 33-year-old from Uxbridge, Ont., earned her Canadian-record 68th international cap in Canada’s first-ever victory over New Zealand in May at the Pacific Four Series.

Twenty three of the 30 Canadian players selected for WXV 1 were part of that Pacific Four Series squad.

Rouet’s roster includes the uncapped Asia Hogan-Rochester, Caroline Crossley and Rori Wood.

Hogan-Rochester and Crossley were part of the Canadian team that won rugby sevens silver at the Paris Olympics, along with WXV teammates Fancy Bermudez, Olivia Apps, Alysha Corrigan and Taylor Perry. Wood is a veteran of five seasons at UBC.

The 37-year-old Paquin, who has 38 caps for Canada including the 2014 Rugby World Cup, returns to the team for the first time since the 2021 World Cup.

Canada opens the tournament Sept. 29 against France at B.C. Place Stadium in Vancouver before facing Ireland on Oct. 5 at Willoughby Stadium at Langley Events Centre, and England on Oct. 12 at B.C. Place.

The second-tier WXV 2 and third-tier WXV 3 are slated to run Sept. 27 to Oct. 12, in South Africa and Dubai, respectively.

WXV 2 features Australia, Italy, Japan, Scotland, South Africa and Wales while WXV 3 is made up of Fiji, Hong Kong, Madagascar, the Netherlands, Samoa and Spain.

The tournament has 2025 World Cup qualification implications, although Canada, New Zealand and France, like host England, had already qualified by reaching the semifinals of the last tournament.

Ireland, South Africa, the U.S., Japan, Fiji and Brazil have also booked their ticket, with the final six berths going to the highest-finishing WXV teams who have not yet qualified through regional tournaments.

Canada’s Women’s Rugby Team WXV 1 Squad

Forwards

Alexandria Ellis, Ottawa, Stade Français Paris (France); Brittany Kassil, Guelph, Ont., Guelph Goats; Caroline Crossley, Victoria, Castaway Wanderers; Courtney Holtkamp, Rimbey, Alta., Red Deer Titans Rugby; DaLeaka Menin, Vulcan, Alta., Exeter Chiefs (England); Emily Tuttosi, Souris, Man., Exeter Chiefs (England); Fabiola Forteza, Quebec City, Stade Bordelais (France); Gabrielle Senft, Regina, Saracens (England); Gillian Boag, Calgary, Gloucester-Hartpury (England); Julia Omokhuale, Calgary, Leicester Tigers (England); Karen Paquin, Quebec City, Club de rugby de Quebec; Laetitia Royer, Loretteville, Que., ASM Romagnat (France); McKinley Hunt, King City, Ont., Saracens (England); Pamphinette Buisa, Gatineau, Que., Ottawa Irish; Rori Wood, Sooke, B.C., College Rifles RFC; Sara Cline, Edmonton, Leprechaun Tigers; Tyson Beukeboom, Uxbridge, Ont., Ealing Trailfinders (England);

Backs

Alexandra Tessier, Sainte-Clotilde-de-Horton, Que., Exeter Chiefs (England); Alysha Corrigan, Charlottetown, P.E.I., CRFC; Asia Hogan-Rochester, Toronto, Toronto Nomads; Claire Gallagher, Caledon, Ont., Leicester Tigers (England); Fancy Bermudez, Edmonton, Saracens (England); Julia Schell, Uxbridge, Ont., Ealing Trailfinders (England); Justine Pelletier, Rivière-du-Loup, Que, Stade Bordelais (France); Mahalia Robinson, Fulford, Que., Town of Mount Royal RFC; Olivia Apps, Lindsay, Ont., Lindsay RFC; Paige Farries, Red Deer, Alta., Saracens (England); Sara Kaljuvee, Ajax, Ont., Westshore RFC; Shoshanah Seumanutafa, White Rock, B.C., Counties Manukau (New Zealand); Taylor Perry, Oakville, Ont., Exeter Chiefs (England).

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Follow @NeilMDavidson on X platform, formerly known as Twitter

This report by The Canadian Press was first published Sept. 18, 2024.

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Vancouver Canucks star goalie Thatcher Demko working through rare muscle injury

Published

4 mins ago

September 19, 2024

Anne Joseph

PENTICTON, B.C. – Vancouver Canucks goalie Thatcher Demko says he’s been working his way back from a rare lower-body muscle injury since being sidelined in last season’s playoffs.

The 28-year-old all star says the rehabilitation process has been frustrating, but he has made good progress in recent weeks and is confident he’ll be able to return to playing.

He says he and his medical team have spent the last few months talking to specialists around the world, and have not found a single other hockey player who has dealt with the same injury.

Demko missed several weeks of the last season with a knee ailment and played just one game in Vancouver’s playoff run last spring before going down with the current injury.

He was not on the ice with his teammates as the Canucks started training camp in Penticton, B.C., on Thursday, but skated on his own before the sessions began.

Demko posted a 35-14-2 record with a .918 percentage, a 2.45 goals-against average and five shutouts for Vancouver last season.

This report by The Canadian Press was first published Sept. 19, 2024.

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