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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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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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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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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Key insights from the week that was. While the RBA’s decision to leave the cash rate unchanged at 4.35% was widely anticipated, there were noteworthy shifts in language in the decision statement. Most poignant was the removal of the “not ruling anything in or out” guidance that stood in place for the much of this […]

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In focus today In the euro area, we expect the ECB to deliver a 25bp rate cut. Although that is the consensus, markets price in around a 15% probability of a 50bp cut this morning according to Reuters. Rather than focusing on the size of the rate cut, we should focus on where the policy […]

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Markets Today’s November US CPI inflation numbers convinced final doubters that the Fed would stick to the plan set out in the September dot plot and lower rates by 25 bps at its policy meeting next year. The data printed bang in line with expectations: a 0.3% monthly increase in both headline and core CPI […]

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The Bank of Canada (BoC) cut its overnight rate by 50 basis points, to 3.25%, while stating that it will continue with Quantitative Tightening (QT). The bank highlighted that economic growth has been weaker than they expected, stating that “the economy grew by 1% in the third quarter, somewhat below the Bank’s October projection, and […]

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BoC cut its overnight rate by 50 basis points to 3.25% as anticipated, but a notable shift in tone suggests a loosening of its easing bias. The central bank stated that interest rates have been reduced “substantially” since June, signaling that future cuts would be evaluated “one decision at a time.” This marks a clear […]

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The Bank of Canada today reduced its target for the overnight rate to 3¼%, with the Bank Rate at 3¾% and the deposit rate at 3¼%. The Bank is continuing its policy of balance sheet normalization. The global economy is evolving largely as expected in the Bank’s October Monetary Policy Report (MPR). In the United States, the […]

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The Canadian dollar is drifting on Wednesday, ahead of the Bank of Canada rate decision later today. In the European session, USD/CAD is trading at 1.4181, up 0.10% at the time of writing. BoC expected to slash rates by 50 basis points The Bank of Canada is widely expected to end the year on a […]

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As evidenced by the USD/CAD chart, yesterday the rate climbed above 1.4190 – a level not seen since April 2023, when the world was gripped by panic over the spread of the coronavirus. Today, the weakness of the Canadian dollar relative to the USD is being influenced by a rich fundamental backdrop. As reported by […]

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Australian Dollar continued its decline today as speculation mounted that China might allow Yuan to weaken in 2025 to counteract the economic impact of increased US trade tariffs under the incoming Trump administration. While no official announcement has been made, Beijing appears to ready to signal greater reliance on market-driven currency valuation. Also, according to […]

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