With the ongoing Russia-Ukraine war, OECD recently lowered its estimates for global growth, slashing it to 3 per cent in 2022 from 4.5 per cent projected last year.
In 2023, the global growth is estimated to decline further to 2.75 per cent.
Current inflation across OECD countries in 2022 is 9 per cent, twice its earlier projections. The organization said that with the ongoing humanitarian crisis, high inflation could persist in rich countries and create food shortages for poorer ones. It called for global cooperation to prevent a food crisis by avoiding mistakes similar to those that led to the inequity in vaccine distribution.
“The price of this war is high and will need to be shared,” said Laurence Boone, the OECD’s chief economist.
The report said if the war continues to escalate, European economies relying heavily on Russian fuel may worsen, because alternative energy sources may not be enough or easy to ramp up.
“Governments also have to play a role through support targeted to those most vulnerable to rising food and energy inflation,” Ms. Boone said.
SO, WHERE DOES CANADA STAND?
Canada’s economy has largely recovered from the pandemic but the OECD report said the Bank of Canada should continue to raise its policy rate and shrink its balance sheet in order to return to its target inflation.
Along with income from high resource prices, a large part of the recovery, the report said, is due to its limited trade ties with economies that have been hit hard by the war in Ukraine.
Current inflation in Canada is 6.8 per cent– the highest since 1991 – but the country could follow the same path of the U.S. Federal Reserve’s aggressive rate hike last week, the largest since 1994.
OECD expects the Bank of Canada to move towards a faster policy tightening so that the domestic productive capacity is not strained by the rising demand.
The Bank of Canada has been raising interest rates to curb the impact of inflation.
In a recent speech in Montreal, Bank of Canada deputy governor Toni Gravelle said, “sharp rebound in global demand for goods, along with pandemic-related restrictions and some weather-related events, created the perfect storm.”
With growing demand, the federal and provincial governments should focus on strong resource revenues to reduce the public debt, while targeting temporary income support for households facing living-cost pressures, the report said.
“In Canada, elevated levels of household debt and high house prices remain two key interconnected vulnerabilities,” the bank said in its annual Financial System Review.
INCREASE IN THE POLICY RATE
Following the relaxation of containment measures in late January, Canada has seen large output gains in contact-intensive services and strong contributions from resources sectors, construction, and manufacturing.
But the report has warned about the supply chain disruptions, exacerbated by labour shortages and high inflation. The food and energy price rises are already reducing an average Canadian household’s purchasing power and will negatively impact private spending, even as saving rates return to more normal levels, according to OECD.
OECD said more rate rises from the Bank of Canada could help tame the price pressures and “bring the monetary policy to neutral settings, where it neither stimulates nor weighs on the economy.”
According to the OECD, Canada’s policy rate is projected to increase to 2.5 per cent by early 2023. In case of continuing inflation, the organization forecasted an additional increase in rates.
“We are taking these large steps because inflation has been persistently high, the economy is overheating, and the risk that elevated inflation will become entrenched has increased,” Bank of Canada’s Deputy Governor Paul Beaudry said in his remarks.
STRONG GROWTH TO CONTINUE AMID EXTERNAL SHOCKS
OECD projects Canada’s real GDP is to grow by 3.8 per cent in 2022 and said the country can withstand the economic shocks from the Russia-Ukraine war since it has limited trade links with hard-hit economies.
OECD reported that most economies are relatively tight and are now experiencing labour shortages with a sharp rise in vacancies. Recent data from Statistics Canada showed that the job vacancies climbed to 957,500 in the first quarter, the highest quarterly number on record.
The pandemic resulted in huge declines in international migration which contributed to the labour shortages in some countries.
For Canada, OECD said higher immigration in the country will help ease these labour shortages and the wage pressures in supply-constrained industries.
SANTA CLARA, Calif. (AP) — The San Francisco 49ers placed All-Pro running back Christian McCaffrey on injured reserve because of his lingering calf and Achilles tendon injuries.
The move made Saturday means McCaffrey will miss at least four more games after already sitting out the season opener. He is eligible to return for a Thursday night game in Seattle on Oct. 10.
McCaffrey got hurt early in training camp and missed four weeks of practice before returning to the field on a limited basis last week. He was a late scratch for the opener on Monday night against the Jets and now is sidelined again after experiencing pain following practice on Thursday.
McCaffrey led the NFL last season with 2,023 yards from scrimmage and was tied for the league lead with 21 touchdowns, winning AP Offensive Player of the Year.
The Niners made up for McCaffrey’s absence thanks to a strong performance from backup Jordan Mason, who had 28 carries for 147 yards and a touchdown in San Francisco’s 32-19 victory over the New York Jets. Mason is set to start again Sunday at Minnesota.
After missing 23 games because of injuries in his final two full seasons with Carolina, McCaffrey had been healthy the past two seasons.
He missed only one game combined in 2022-23 — a meaningless Week 18 game last season for San Francisco when he had a sore calf. His 798 combined touches from scrimmage in the regular season and playoffs were the third most for any player in a two-year span in the past 10 years.
Now San Francisco will likely rely heavily on Mason, a former undrafted free agent out of Georgia Tech who had 83 carries his first two seasons. He had at least 10 touches just twice before the season opener, when his 28 carries were the most by a 49ers player in a regular-season game since Frank Gore had 31 against Seattle on Oct. 30, 2011.
The Niners also have fourth-round rookie Isaac Guerendo and Patrick Taylor Jr. on the active roster. Guerendo played three offensive snaps with no touches in the opener. Taylor had 65 carries for Green Bay from 2021-23.
San Francisco also elevated safety Tracy Walker III from the practice squad for Sunday’s game against Minnesota.
BRUSSELS – Canada walked away with some hardware at the Diamond League track and field competition Saturday.
Alysha Newman finished third in women’s pole vault, while Marco Arop did the same in the men’s 800-metre race.
Newman won a bronze medal in her event at the recent Paris Olympics. Arop grabbed silver at the same distance in France last month.
Australia’s Nina Kennedy, who captured gold at the Summer Games, again finished atop the podium. Sandi Morris of the United States was second.
Newman set a national record when she secured Canada’s first-ever pole vault medal with a bronze at the Olympics with a height of 4.85 metres. The 30-year-old from London, Ont., cleared 4.80 metres in her second attempt Saturday, but was unable conquer 4.88 metres on three attempts.
Arop, a 25-year-old from Edmonton, finished the men’s 800 metres with a time of one minute 43.25 seconds. Olympic gold medallist Emmanuel Wanyonyi of Kenya was first with a time of 1:42.70.
Djamel Sedjati, edged out by Arop for silver in Paris last month, was second 1:42.87
This report by The Canadian Press was first published Sept. 14, 2024.
MILAN (AP) — Bologna’s preparations for its Champions League debut are not going well though it managed to spoil Como’s first Serie A home match in 21 years on Saturday.
Bologna came from two goals down to salvage a 2-2 draw to gather three points from its opening four matches.
Bologna hosts Shakhtar Donetsk on Wednesday. Its only other appearance in Europe’s top competition was in 1964 in the preliminary round of the old European Cup.
AC Milan is also winless as it prepares for a Tuesday Champions League match against Liverpool. The Rossoneri hosted promoted Venezia later. Juventus drew at Empoli 0-0.
Como made a great start in the fifth minute when Patrick Cutrone attempted to roll the ball across the six-yard box but it took a huge deflection off Bologna defender Nicolò Casale for an own goal.
Bologna thought it was gifted a way back into the match on the stroke of halftime when referee Marco Piccinini signalled for a penalty following an Alberto Moreno handball, but he revoked his decision and instead gave a free kick because the handball was just outside the area.
Bologna improved after the break but found itself further behind when Cutrone raced onto a through ball and cut inside past a defender and fired into the far bottom corner.
Tommaso Pobega hit the post for Bologna, which finally pulled one back in the 76th through substitute Santiago Castro.
Another substitute helped the visitors snatch a point when Samuel Iling-Junior curled a fine strike into the top left corner in stoppage time.
Unbeaten sides
Juventus, and more surprisingly Empoli, are among six unbeaten sides.
Empoli held Monza and Bologna to draws either side of a shock 2-1 win at Roma. Juventus’ perfect start to the season was ruined by Roma in a goalless draw before the international break.
On Saturday, there were few clearcut chances in Empoli although home goalkeeper Devis Vásquez made spectacular saves to fingertip out a Federico Gatti header and deny Dusan Vlahovic in a one on one with the Juventus forward.
Empoli had a good opportunity in the 73rd minute following an Alberto Grassi one-two with Pietro Pellegri but the finish was straight at Mattia Perin.
The host could have won it right at the death but Gatti flew in with a great sliding block to keep out Emanuel Gyasi’s close-range effort.
Juventus hosts PSV Eindhoven in the Champions League on Tuesday.
