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‘Zero signs of economic stress’: What economists say about the blockbuster jobs report



The jobs report was “even more impressive,” said James Orlando, senior economist at TD Economics, because the “gains were concentrated in full-time jobs in the private sector.”

Of the gain, 121,000 were full-time positions and 28,900 were part-time. The unemployment rate held steady at five per cent and the participation rate rose to 65.7 per cent from 65 per cent in December, the national data agency said.

The economy has added over 800,000 positions since the start of the pandemic, Royal Bank of Canada said in its analysis of the jobs report, adding that “two-thirds of job gains were driven by prime-age workers” in the 25 to 54 age category.

It’s the second month in a row the strength of the employment market has taken forecasters by surprise. The economy, in December reported a gain of 104,000 positions, blowing past forecasts for an increase of 5,000 additional positions, although, the  report was “heavily revised downward” by 33,000 positions, said Jay Zhao-Murray, an FX market analyst with Monex Canada, in an email, “and we may get a repeat of that scenario this month.”

At the time, economists said the strong December numbers would prompt the Bank of Canada to increase interest rates, which it did at its Jan. 27 meeting, hiking its benchmark lending rate to 4.5 per cent.

Based on the latest jobs numbers, some economists say markets could start pricing in another rate hike. The Bank of Canada indicated last month that it would likely pause its hiking campaign if economic data over the next few months tracked along its expectations.

Here’s what economists are saying about the jobs numbers, what they mean for a potential soft-landing for the economy and interest rates.


James Orlando, TD Economics

“It was a blowout report for the Canadian labour market. The 150,000 jobs gain is one thing, but the fact that gains were concentrated in full-time jobs in the private sector, alongside people working more hours, makes this an even more impressive report. Although the seasonal adjustment should be called into question, the sheer size of this print points to a further boost to consumer spending and overall GDP to start the year.

“Today’s report is sure to raise eyebrows at the Bank of Canada. Their conditional pause on further rate hikes is predicated on a slowing of economic growth and an easing in the labour market. The bank won’t adjust course after one report, but it will be closely watching to see if this trend of massive job gains continues.”


Andrew Grantham, CIBC Economics

“Another month, another blockbuster job print for the Canadian economy …. Unlike during the latter part of last year, the strong job figure was also accompanied by an increase in hours worked (+0.8 per cent) as sickness-related absenteeism was closer to seasonal norms, which is a positive for GDP and suggests that the economy certainly isn’t on the verge of recession.

“The Bank of Canada’s conditional pause on interest rates was likely done partly so that policymakers didn’t feel the need to respond to any single strong data print, no matter how strong, but rather assess how the economy is faring over the course of a few months. However, that won’t stop markets reacting to today’s strong data by pricing in a greater probability of further hikes, and pricing out rate cuts.”


Stephen Brown, Capital Economics

“The surge in employment and strong rise in hours worked in January suggest that GDP growth will be stronger than we anticipated this quarter. However, the decline in wage growth means that unexpected strength is unlikely to prompt the Bank of Canada to switch back to hiking mode.

“The 150,000 jump in employment was 10 times as large as the consensus estimate. While the gain was partly due to an unusually large 63,000 rise in the population last month, amid strong immigration, the labour force increased by an even larger 153,000, thanks to a 0.3 percentage-point rise in the participation rate.

“Despite the bumper gain, the labour market data are unlikely to move the needle much for monetary policy, not least because wage growth declined to 4.5 per cent year over, from a downwardly revised 4.7 per cent — it was previously estimated at 5.2 per cent in December. Nevertheless, together with the 0.8 per cent month over month rise in hours worked last month, the data pour cold water on the idea that the economy is on the cusp of recession and suggest we need to revise up our forecast of a 1.5 per cent annualized decline in GDP this quarter.”

Douglas Porter, BMO Economics

“Canadian employment soared 150,000 in January, the largest non-pandemic monthly rise on record and a loud echo of the rollicking U.S. jobs report a week ago. Even in percentage terms, the 0.75 per cent month over month gain is larger than anything seen in the 40 years before COVID.


“Note that actual, or non-seasonally adjusted, employment fell by 125,000 in January — prior to the pandemic, a “normal” January would see a job loss of 250,000-to-300,000 in unadjusted terms. So, evidently, there simply were far, far fewer layoffs than in a normal year at the start of 2023. Instead of an actual hiring boom, what we instead saw last month was a layoff freeze, given how hard it is to find workers in the current environment. To be clear, this is not to dismiss the strength in the headline number; the data are seasonally adjusted for a reason. It’s more to explain what the underlying story may be in this complicated backdrop.


Bottom Line: One always has to take care when reading a Canadian employment report — for example, the prior month’s huge gain was itself revised down (earlier) by more than 30,000 jobs. Still, even if there are some misgivings about the massive headline gain, the labour market is sending precisely zero signs of economic stress. For the Bank of Canada, the strong report must make them at least a tad nervous about their freshly-minted pause — we said the bar for any move would be very high, but the employment gain is pretty towering indeed. This is actually the last jobs report the Bank will see before it next decides in March, but their upcoming decisions will largely be determined by inflation, and the employment data may prove to be just loud noise, provided inflation continues to ebb.”


Charles St-Arnaud, Alberta Central

“Today’s Labour Force Survey data suggest the labour market in Canada remains strong and resilient. The low unemployment rate continues to signal that the labour market remains very tight, something the Bank of Canada is closely monitoring. Moreover, the report also shows that wage growth, while slowing, remains robust, with average wages increasing by 4.2 per cent year over year.


“A robust labour market is a challenge for the Bank of Canada. As we have explained on numerous occasions, the bank needs to slow growth and create some excess capacity in the economy to fight inflation. This will likely lead to a rise in the unemployment rate and job losses. With this in mind, continued strength and tightness in the labour market may not be a welcomed outcome for the Bank of Canada.

“The continued resilience of the labour market raises the odds that the bank will increase its policy rate at its next meeting on March 8. However, whether the bank hikes further depends on inflation, with the next release on Feb. 21, and the growth outlook. Nevertheless, it may require some signs that underlying inflationary pressures are not moderating as quickly as expected for the bank to hike at the March meeting.”


Carrie Freestone, Royal Bank of Canada

“Headline numbers conflict with recent Bank of Canada Survey data. The Bank of Canada Business Outlook Survey indicated business plans to hire staff have fallen alongside wage growth. This conflicts with the January Labour Force Survey data. Indeed, year-over-year wage growth has fallen to 4.5 per cent year-over-year, but hiring continues at a rapid pace and the unemployment rate held steady at a near record low 5 per cent. Any signs of labour market cooling require a deeper dive beyond headline numbers.

“Job postings are still up 50 per cent from pre-pandemic levels, but have come down in recent months. It remains our view that labour markets will not remain this tight over the near term. The delayed impact of the Bank of Canada’s 425 basis points of hikes are still gradually flowing through to household and business debt payments and will ultimately erode demand, pushing unemployment higher through the end of the year. Moreover, with record high participation and fewer unemployed Canadians to fill jobs, job creation is not sustainable at the current pace.


“The Bank of Canada has indicated that rates will be held steady unless there is sufficient evidence that more restrictive monetary policy is needed. While the Bank of Canada will likely look past one strong jobs report, if additional reports prove to be stronger than expected, this would pose upside risk to the current terminal rate forecast of 4.5 per cent.”


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NOVA Chemicals sets bold ESG aspirations to lead the plastics circular economy – Financial Post



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• Net-zero by 2050 • 30 per cent of polyethylene sales from recycled content by 2030 • Reduce Scope 1 and 2 absolute CO2 emissions by 30 per cent • Become a Top 30 company in Canada •Investment of USD $2-4 billion

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CALGARY, AB, March 22, 2023 (GLOBE NEWSWIRE) — NOVA Chemicals Corporation (“NOVA Chemicals”) today announced sector-leading ESG ambitions to drive the circular economy for plastics, in line with its vision to become the leading sustainable polyethylene producer in North America.

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By 2030, the company aims to:

  • Set new industry standards for driving the transition to the plastics circular economy and solidifying the market for recycled polyethylene, with 30 per cent of its polyethylene sales[i] from recycled contet;
  • Be at the forefront of decarbonization by reducing its Scope 1 and 2 absoute CO2 emissions by 30 per cent[ii]; and
  • Become a Top 30 company in Canada.

Outlined in NOVA 2030: Our Roadmap to Sustainability Leadership, NOVA Chemicals has also shared its aspiration to reach net-zero Scope 1 and 2 emissions by 2050.

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“NOVA’s Roadmap to Sustainability Leadership details a strong plan forward for the company to become the leader in sustainable polyethylene production while building on our commitments to developing innovative solutions for our customers, enabling the circular economy, and being a responsible steward of our environment,” stated Danny Dweik, CEO. “Plastic products play an essential role in our daily lives. With our renewed purpose of reshaping plastics for a better, more sustainable world, we have developed a clear pathway to become a catalyst for a low carbon, zero-plastic-waste future.”

To achieve these aspirations, NOVA Chemicals anticipates investing between USD$2-4 billion by 2030 to expand its sustainable product offerings, decarbonize assets, and build a state-of-the-art mechanical recycling business while exploring new advanced recycling technologies to create high-quality, high-performance recyclable and low carbon plastics.

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Building on its proprietary, Advanced SCLAIRTECHTM technology (AST), NOVA Chemicals will explore expanding its product portfolio to include the development of innovative, advanced materials. These new product offerings, which will include the company’s first ASTUTE™ polyolefin plastomers line, will better serve existing customers and provide more options for sustainability-focused end markets such as electric vehicles and renewables.

NOVA Chemicals has already begun growing its portfolio of recycled and recyclable polyethylene resins through its recently announced launch of SYNDIGO™ recycled polyethylene, a new portfolio of products made from circular polymers to encourage both waste and emissions reductions.

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The company’s 2030 aspirations are shorter-term objectives that will help NOVA Chemicals reach its ultimate goal of achieving net-zero Scope 1 and 2 absolute CO2 emissions by 2050. NOVA Chemicals has developed a technical solutions-focused roadmap for decarbonizing its asset base by improving energy efficiencies, electrifying and acquiring renewable power, and exploring clean hydrogen as a low carbon fuel source and Carbon Capture, Utilization, and Storage (CCUS). The company will also continue to pursue new technologies to abate and eliminate emissions from its production processes, such as the development of its proprietary Low Emissions Ethylene Process (LEEP™) technology.

The company has also announced a virtual power purchase agreement (VPPA) with Shell Energy for renewable power, marking the first of many opportunities to increase low carbon, renewable energy in its power portfolio.

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Today’s announcement builds upon NOVA Chemicals’ long-standing commitment to developing innovative solutions for its customers while enabling the circular economy and preparing for and responding to a changing world. NOVA’s approach to managing its material ESG topics including Responsible Care® and its commitment to the environment, health, and safety, can be found in its annual ESG report.

Learn more about NOVA 2030: Our Roadmap to Sustainability Leadership.

– 30 –

About NOVA Chemicals Corporation
NOVA Chemicals aspires to be the leading sustainable polyethylene producer in North America. Our driving purpose is to reshape plastics for a better, more sustainable world by delivering innovative solutions that help make everyday life healthier and safer and acting as a catalyst for a low carbon, zero-plastic-waste future. NOVA Chemicals’ innovative and quality product offerings, value chain collaboration, and unique customer experience is what sets us apart; our customers use our products to create easy-to-recycle and recycled content films, packaging, and products. Our employees work to ensure health, safety, security, and environmental stewardship through our commitment to sustainability and Responsible Care®.

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NOVA Chemicals, headquartered in Calgary, Alberta, Canada, has nearly 2,500 employees worldwide and is wholly owned by Mubadala Investment Company of the Emirate of Abu Dhabi, United Arab Emirates. Learn more at or follow us on LinkedIn.

NOVA Chemicals’ logo is a registered trademark of NOVA Brands Ltd.; authorized use.
Advanced SCLAIRTECH™, SYNDIGO™, LEEP™, and ASTUTE™ are trademarks of NOVA Chemicals. 
Responsible Care® is a registered trademark of the Chemistry Industry Association of Canada.

This news release contains forward-looking statements. By their nature, forward-looking statements require NOVA Chemicals to make assumptions and are subject to inherent risks and uncertainties. NOVA Chemicals’ forward-looking statements are expressly qualified in their entirety by this cautionary statement. In addition, the forward-looking statements are made only as of the date of this news release, and except as required by applicable law, NOVA Chemicals undertakes no obligation to update the forward-looking statements to reflect new information, subsequent events or otherwise.

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Statements in this news release as to future aspirations, ambitions or goals, including any projections or plans to reduce emissions or emissions intensity, and projections or plans to increased recycled polyethylene or in respect of circularity, to increase the size, value or ranking of NOVA Chemicals, or in regards to any investments or investment amounts, are forward-looking statements.  In addition, any roadmaps related to the foregoing represent forward-looking statements as well.  Any actual future results could vary depending on NOVA Chemicals’ ability to execute on a timely and successful basis, on policy and consumer support, changes in laws and regulations, unforeseen difficulties, and the outcome of research efforts or technology developments.

[i] On a volume basis
[ii] Under operational control, 2020 baseline



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‘Already past the point of no return’: JPMorgan says the U.S. is probably headed for a recession as economic ‘engines are about to turn off’ – Yahoo Finance



A series of banking crises this month headlined by the failure of Silicon Valley Bank has forced analysts from multiple banks, including JPMorgan Chase, to rewrite their recession forecasts from scratch, as months of small victories against inflation and a relatively strong economy were potentially swept away in under two weeks.

Even if the government and the private sector are able to successfully contain contagion from the bank collapses spreading through the economy, the failures may still lead to lasting damage for the U.S. financial system. Some banks are teetering on the edge in Europe and the U.S., while jittery markets and the promise of stricter regulation could lead to a credit crunch—a steep decline in banks’ willingness to lend caused by a lack of funds.

It adds up to an impossible choice the Federal Reserve has to make when officials meet on Wednesday: Slow down the pace of interest rate hikes or plow ahead to bring down resurgent inflation and risk amplifying damage to the economy. But as far as the Fed is concerned, hopes of engineering a soft landing for the economy and avoiding a recession may already be in the rearview mirror.


“The Fed is facing a difficult task on Wednesday, but it is likely already past the point of no return,” JPMorgan strategists led by Marko Kolanovic, the bank’s chief global markets strategist, wrote in a note to clients Monday. “A soft landing now looks unlikely, with the airplane in a tailspin (lack of market confidence) and engines about to turn off (bank lending).”

It is still unclear how far contagion from SVB will spread. New York–based Signature Bank failed days after SVB, requiring sweeping government measures to restore confidence that account holders in both banks would be made whole, but other small-sized and regional banks remain in precarious positions. San Francisco–based First Republic remains at high risk, although larger U.S. banks banded together last week to provide a $30 billion deposit to prop up its finances. Treasury Secretary Janet Yellen also pledged Tuesday that the government was prepared to step in again if issues at other banks “pose the risk of contagion.” But even if depositors are safeguarded, the damage may have already been done.

“Even if central bankers successfully contain contagion, credit conditions look set to tighten more rapidly because of pressure from both markets and regulators,” JPMorgan wrote.

The analysts referred to current challenges as a possible “Minsky moment,” named after the American economist Hyman Minsky, who famously predicted that extended bull markets naturally end in epic and monumental collapses. A Minsky moment happens when the inevitable check comes due and the house of cards finally falls down. JPMorgan analysts wrote our Minsky moment is nearing as the past few weeks alone have seen a number of economic and geopolitical threats to the world, including banking crises on both sides of the Atlantic, China striking a new diplomatic deal with Saudi Arabia and Iran, and Chinese President Xi Jinping’s high-profile trip to Moscow and visit with sanctioned Russian counterpart Vladimir Putin, who was recently issued an international arrest warrant for war crimes committed in Ukraine.

Investors and historians have warned for years that an extended bull market in the U.S. since 2009 would inevitably lead to an economic overcorrection: “The long, long bull market since 2009 has finally matured into a fully-fledged epic bubble,” investor and market historian Jeremy Grantham wrote in 2021. More recently, Grantham has been warning of an all-consuming “everything bubble,” which he called “pretty damn big” during an interview this month with economist David Rosenberg.

“‘There are decades where nothing happens; and there are weeks where decades happen,’” JPMorgan analysts wrote, citing a famous Vladimir Lenin quote.

JPMorgan isn’t the only major bank to have downgraded its economic forecasts in recent weeks; Goldman Sachs also told clients last week the banking crisis could deliver a severe blow to U.S. economic growth. And former Treasury Secretary Larry Summers has warned multiple times in recent months even before the banking crisis that the economy could be headed for a “Wile E. Coyote moment,” having already run off a cliff edge but still blissfully unaware of the sudden crash about to happen.

The longest bull market in U.S. history that began in 2009 only ended in 2020 because of the COVID-19 pandemic. The short-lived 2020 recession was quickly replaced by another ferocious bull market in 2021, but after a year of slowing growth, the long-awaited Minsky or Wile E. Coyote moment may have finally arrived.

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The US interest-rate decision the world is watching – BBC



Jerome PowellReuters

The global economy is facing a slew of problems – and all eyes are looking in one direction: America.

Two banking failures in the US this month have raised fears about the health of the financial system.

The collapses follow a sharp rise in global borrowing costs, led by the US, which has shocked the world economy and raised worries about a painful downturn known as a recession.


At the centre of the crisis is the US central bank.

Since last year, authorities at the Federal Reserve have been leading the charge to raise interest rates, as they wrestle to rein in price increases driving up the cost of living.

With risks to the economy rising, can that campaign continue?

Just two weeks ago, Chairman Jerome Powell warned the bank might need to raise interest rates further and faster than expected, citing concerns that progress on stabilising prices was stalling.

The rate at which prices rise was 6% in the 12 months to February – far higher than the 2% rate considered healthy.

But the recent banking turmoil has many investors betting the Fed will be especially keen to avoid startling financial markets with a big move.

Many analysts expect officials to raise rates by 0.25 percentage points – or perhaps hold off on an increase entirely.

Whatever the decision, Mr Powell is squarely in the hot seat – with little chance of satisfying his many critics.

“This is probably the toughest decision the Fed has had to make in a while,” says Ryan Sweet, chief economist at Oxford Economics, who is expecting a 0.25 percentage point increase.

He says Mr Powell will “have to play the two-handed economist perfectly”, convincing investors that the central bank can still raise rates to fight inflation on the one hand, while using other tools to combat stress in the financial system.

“The biggest challenge is going to be communication and the Fed doesn’t have a really good track record.”

Mr Powell, a lawyer who was appointed to lead the Fed by former President Donald Trump, already had work to do to restore credibility, after he infamously described the price rises that started to hit America in 2021 as “transitory”.

The bank failures have added to the scrutiny, putting into focus costs from the rapid rate rise campaign, while raising questions about whether the Federal Reserve had been too lax in its oversight.

Elizabeth Warren


Senator Elizabeth Warren, a progressive Democrat who has long faulted Mr Powell’s response to inflation, has accused him of presiding over an “astonishing list of failures”, including faulty supervision.

She said this week she did not think he should remain in his post.

And though the reasoning is different, criticism of Mr Powell has also grown louder on Wall Street and in Silicon Valley.

“The Fed should have reacted to inflation six months earlier, and then raise rates more gradually. Instead they slammed on the brakes and now we have a car crash,” venture capitalist David Sacks wrote on Twitter in the wake of the bank failures.

With outcry widening, the White House this week issued a statement affirming US President Joe Biden’s “confidence” in Mr Powell.

Mr Sweet said such an unusual step is a sign in part of a more toxic turn in politics.

“I think on both sides, they’re much more quick to criticise and point the finger,” Mr Sweet said.

Over the past year, the Fed has raised its key rate – what it charges banks to borrow – from near zero to more than 4.5% – the highest level since 2007.

But strong hiring has helped the economy hold up better than many expected, despite a sharp slowdown in the housing market and struggles in the tech sector, where low borrowing costs had helped fuel growth.

Still, the recent banking panic is likely to push the US economy into recession sooner than expected – and there is little doubt that pressure on Mr Powell has increased, Mr Sweet said.

“Anytime you get any stress in the banking system all eyes turn to the Federal Reserve.”

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