The Bottom Line: Today’s GDP report shows Canadian economic growth accelerated in October from September; however, the early estimate points to a contraction (-0.1%) in November, consistent with preliminary reports showing softer wholesale sales, declining manufacturing volumes, and flat retail sales. The Bank of Canada’s December messaging pointed to a more gradual approach on rate […]

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Canadian economic growth jumped 0.3% month-on-month (m/m) in October, ahead of Statistics Canada’s advanced guidance and consensus expectations. Early estimates from Statistics Canada point to a slight pullback in November GDP (-0.1% m/m). October’s reading was broad-based, with output expanding in 12 of 20 industries. The goods sector grew by a hefty 0.8% m/m, while […]

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Dollar edged higher in subdued holiday trading, maintaining its recent  strength but staying within a narrow range below last week’s highs against major currencies. Markets largely brushed aside the disappointing US durable goods orders data, as the series is known for its volatility. Moreover, traders are prioritizing labor market and consumption trends, which Fed views […]

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Canada’s GDP rose 0.3% mom in October, surpassing expectations of 0.2% mom, with 12 out of 20 sectors contributing to the growth. This marked a rebound for the goods-producing industries, which expanded by 0.9% mom after four months of contraction, driven primarily by mining, quarrying, and oil and gas extraction. The services-producing industries edged up […]

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The Canadian dollar posted its fourth straight losing week, declining about 1%. In Monday’s European session, USD/CAD is trading at 1.4397, up 0.16% at the time of writing. Canada’s GDP expected to remain at 0.1% The market is keeping expectations low for today’s GDP report, with a forecast of 0.1% m/m for October after a […]

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As markets wind down for the year-end holiday period, forex trading activity turns subdued, with limited momentum across major pairs. Dollar, while maintaining its position as the strongest currency of the month, is facing challenges in decisively breaking last month’s highs against European majors. However, the greenback still made some headway against Yen and commodity […]

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Canadian Highlights The Fall Economic Statement (FES) was delivered amid a chaotic week for the federal government. Larger deficits and modest stimulus were features, although the FES is unlikely to change the Bank of Canada’s thinking on policy. Data on the real economy was mixed, with gains in home sales and starts in November, but […]

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The final major data point from Statistics Canada in 2024 will be Monday’s gross domestic product release for October, which will be the last GDP print before the Bank of Canada’s Jan. 29 meeting. We look for a 0.2% increase that would be the strongest monthly gain since April, and firmer than the 0.1% advance […]

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Dollar’s strong rally paused in early US trading after PCE inflation data came in below expectations, easing concerns that Fed might maintain higher rates for an extended period. Markets are also digesting remarks from Fed officials following the hawkish rate cut earlier in the week. Most notably, Cleveland Fed President Beth Hammack, the sole dissenter […]

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Retail sales rose by a solid 0.6% month-over-month (m/m) in October, slightly below Statistics Canada’s advance estimate of 0.7% m/m. In real terms, however, sales were unchanged. Sales at motor vehicle and parts dealers accelerated by 2.0% m/m, reversing September’s losses. Ex-autos, sales were up 0.1% m/m, falling short of the consensus expectation of 0.4% […]

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Canada’s retail sales rose 0.6% mom to CAD 67.6B in October, above expectation of 0.4% mom. Sales were up in five of nine subsectors and were led by increases at motor vehicle and parts dealers. Core retail sales—which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers—were up 0.2% mom. In volume terms, […]

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Canada joined the global political gloom. The sudden resignation of the finance minister on Monday started raising questions about Trudeau’s leadership as politicians there try to find ways to deal with economic slowdown topped by Trump’s tariff threats. Happily for the Bank of Canada (BoC), inflation dropped below the 2% target for the second time […]

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Canadian Dollar trades broadly lower today while commodity currencies are generally soft. Canada’s CPI report reinforced the outlook of stable inflation hovering around target. BOC has likely completed its aggressive rate-cutting phase and pauses in policy easing are anticipated at some meetings next year. Nonetheless, the direction remains clear: further rate reductions are expected to […]

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Headline CPI inflation cooled to 1.9% year-on-year (y/y) in November, one tick softer than expected. Slower price growth was broad based across the eight major components. The one exception was transportation costs which rose to 1.1% y/y, from 0.3% in October. Shelter inflation has been a key challenge for Canadians for some time now and […]

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Canada’s headline CPI slowed to 1.9% yoy in November, dipping below expectations of 2.0% yoy and down from 2.0% yoy in October. The deceleration was broad-based, with declines in travel tour prices and the mortgage interest cost index contributing significantly to the slower pace of inflation. Excluding gasoline, the CPI rose 2.0% yoy, cooling from […]

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Markets Yesterday’s PMI releases in Europe and the US confirmed the ongoing divergence in growth on both sides of the Atlantic, cementing market expectations on similar divergence in Fed and ECB policy. The S&P global US flash PMI showed output growth at the end of the year at a 33-month high (56.6 from 54.9) amid […]

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Dollar ended as the strongest performer last week, boosted by a surge in U.S. Treasury yields following persistent inflation data. Despite expectations of another 25bps rate cut at the upcoming FOMC meeting, stubborn price pressures are likely to slow the pace of policy easing next year. Adding to the caution, inflation uncertainties under the incoming […]

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Canadian Highlights The Bank of Canada lowered its policy rate by 50 bps to 3.25%. This is the second straight upsized cut to interest rates, and marks a cumulative 175 bps of easing since the Bank first lowered rates in June. There are more cuts to come in 2025, but the Bank’s forward-looking comments signaled […]

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Summary United States: Sticky Inflation, Sticky Wicket for the Fed Price data this week showed that inflation remains stubbornly above the FOMC’s target. Overall inflation has trended sideways in recent months, and while we do not expect this week’s data to prevent the Fed from cutting another 25 bps next week, it will likely contribute […]

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Canadian consumer price index growth is expected to have eased slightly in November after picking up in October, which is consistent with a persistently softening economy that’s left broader inflation pressures tracking at or below the Bank of Canada’s 2% target. We expect headline inflation to have eased to 1.9% in November. Price growth in […]

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