Category Canadian economy
Dealing with a terms of trade shock
The most important graph from the Bank of Canada’s Monetary Policy Report (pdf): The shift in the terms of trade plays a leading role in the story of the the Canadian macroeconomy over the past five years. Deputy Governor Pierre Duguay’s speech last August puts it this way: "The substantial rise in real commodity prices […]
The Bank of Canada leaves the overnight rate at 4.25%
Even though the growth in demand has slowed somewhat – largely due to a slowdown in exports to the US – the Bank isn’t in any particular hurry to start lowering interest rates just yet. According to their projection, demand will still be strong enough to be putting upward pressure on inflation for at least […]
Canada’s trade surplus: Running on fumes
The trade surplus increased in August: Canadian companies exported merchandise worth $38.7 billion in August, up 0.3% from July, with strong gains in industrial goods and materials and automotive products. On the other hand, imports declined 0.6% to $34.5 billion, following two consecutive monthly increases. The resulting merchandise trade surplus amounted to $4.2 billion, compared […]
The Bank of Canada’s Business Outlook Survey: It’s quiet. It’s *too* quiet.
From the autumn survey (pdf): "The balance of opinion on future sales growth has fallen close to zero, indicating that sales are expected to increase at about the same pace as in the past 12 months. Many firms in Western Canada, including those in the services sector, are facing capacity constraints and therefore do not […]
Who gets paid minimum wage in Canada
2005 data (pdf): Percentage of employees who were paid minimum wage: 4.3 Percentage of minimum-wage workers who were – working part-time: 59.2 – between 15 and 19 years old: 44.5 – students living at home: 33.2 – heads of a household with children under 18: 5.4 The Toronto Star, in its […]
Useless factoid of the day: Canada is 16th on the WEF competitiveness report
I’ve spent half an hour on the WEF site, and I can’t for the life of me figure out what they’re measuring. Or why it matters.
Because a good central banker will always be worrying about something
Inflation is in the middle of the target zone, output is at capacity, and the overnight rate is where the Bank of Canada thinks it should be to keep things that way. But that doesn’t mean that it’s become complacent: Central bank issues stimulus warning: Bank of Canada cautions provinces, Ottawa on plans for budget […]
Canadian Sisyphus
Yet another quarter in which Canada had a current account surplus, only to see its net international investment position (NIIP) deteriorate after revaluation. Even though Canada has an accumulated current account surplus of $156b since 2000, CAD appreciation (40% against the USD since 2002) has meant that the NIIP has improved by only $68b during […]
Canada gets an ‘attaboy’ from the IMF
The World Economic Outlook – all 297 pages of it – is out. Here is the paragraph on Canada: The Canadian economy continues to perform robustly, benefiting from its strong macroeconomic policy framework and the boom in global commodity prices. The main risks to the outlook are external, including the possibility of a sharper-than-expected slowing […]
The yield curve shifted, then tilted
There seems to be little doubt that beliefs about a US slowdown were sharply revised over the summer. Here are the US and Canadian yield curves for March, June and September: And here are the interest rate differentials: Perhaps the CAD hasn’t yet finished appreciating against the USD.
Worthwhile Canadian Initiative 
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