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E9 Will the Bank of Canada be influenced by higher for longer in the U.S.?

Forward Guidance

For the week of May 6, 2024

Economic Analysis

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Job growth in the U.S. slowed in April

May 3, 2024

Payroll employment growth slowed at the start of Q2, to 175k in April from an average pace of 270k in the first quarter. That pace itself can still be considered as solid, but was below consensus forecast of 245k.

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U.S. Fed held interest rates unchanged in May

May 1, 2024

The U.S. Fed held the fed funds target rate unchanged (as widely expected) in its May policy announcement, but acknowledged that progress in slowing inflation has stalled in recent months.

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Featured Insights

Podcast: The 10-Minute Take

May 2, 2024

On this week’s episode, Claire and Carrie start by going over where the potential concerns are with a rate divergence between the Bank of Canada and the Fed, before getting to why the BoC is not expected to be derailed in its upcoming easing cycle.

Proof Point: A weaker Canadian dollar won’t necessarily derail BoC interest rate cuts

April 23, 2024

The timing and magnitude of interest rate cuts from the Bank of Canada will be determined by domestic economic and inflation conditions and not the gap in monetary policy with the U.S.

Federal Budget 2024: Lack of spending restraint offset by revenue surprise and tax hikes

April 16, 2024

Budget 2024 showed a slightly worse bottom line throughout the federal government’s fiscal plan compared to previous estimates but kept...

RBC Canadian Inflation Watch

April 16, 2024

RBC Economics provides an analysis of the key indicators on price trends in Canada.

Proof Point: Governments face higher interest costs when straying from fiscal anchors

April 11, 2024

Straying from fiscal budget anchors negatively impacts governments’ credibility and increases lending risks for bond investors.

RBC U.S. Inflation Watch

April 10, 2024

RBC Economics provides a monthly analysis of the key indicators on price trends in the United States.

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Canadian Housing

Mixed start to the spring housing market

April 12, 2024

March brought a mixed bag of activity to Canada’s housing market. Resales continued to linger around February levels at the national level—still softer than activity that took place pre-pandemic.

The Great Rebuild
Seven ways to fix Canada’s housing shortage

April 8, 2024

Too many Canadians are struggling to find a home they can afford—making housing the defining issue of this country’s politics and economics.

Toughest time ever to afford a home as soaring interest costs keep raising the bar

April 2, 2024

High interest rates propelled ownership costs to new summit in the fourth quarter of 2023: A household earning a median income needed to spend a staggering 63.5% of it to cover the costs of owning an average home at market price.

Bumpy recovery for Canada’s housing market

March 18, 2024

February offered valuable clues on the direction Canada’s housing market is taking. Improving sentiment among buyers and sellers—no doubt stoked by growing expectations

Reality check: Canada’s housing market isn’t out of the woods yet

March 8, 2024

Anyone expecting smooth sailing ahead for the housing market got a reality check in February. Month-to-month drops in home resales in several of Canada’s major markets were a reminder that very challenging affordability conditions

End of the correction? Canada’s housing market is warming up

February 14, 2024

Home resales in Canada increased for the second month in a row in January, rising 3.7% from December. Resales are back up to where they were last summer including the December advance.

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Economy and Markets

BoC and the Fed, you gotta keep ‘em separated

April 10, 2024

A resilient U.S. economy and signs of reacceleration in inflation look likely to derail Fed plans to cut interest rates by 75 basis points this year – we now look for just one 25 basis point cut in December.

Canadian economic slowdown is not over

March 12, 2024

The Canadian economy is still slowing as the lagged impact of earlier interest rate increases materialize. Gross domestic product edged...

U.S. outperformance continues but no sunshine yet for the Canadian economy

March 12, 2024

Resilience in the U.S. continues to buoy investors’ spirits. Conditions also look to have already bottomed out in the euro area and U.K. In Canada, things are much less upbeat.

New rules

February 7, 2024

How will the rest of this current rate cycle from the BoC compare with previous ones? In short, we expect more things to differ than to stay the same.

Ordinary pain

January 9, 2024

Fed willingness to talk about interest rate cuts sent markets rallying to close out 2023.

Special edition - keeping an eye on Canada’s credit rating

December 12, 2023

A softening economic growth backdrop has left central banks in Canada, the Euro Area, and the U.K. on hold.

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Provincial Outlook and Fiscal Analysis

Federal Budget 2024: Lack of spending restraint offset by revenue surprise and tax hikes

April 16, 2024

Budget 2024 showed a slightly worse bottom line throughout the federal government’s fiscal plan compared to previous estimates but kept...

Manitoba Budget 2024: Deficit cut in half but debt burden continues to grow

April 3, 2024

The provincial debt burden is expected to be the heaviest on record, reaching 39.1% of gross domestic product by fiscal 2025-26.

Ontario Budget 2024: Balancing priorities, not the books

March 27, 2024

Province anticipates $9.8 billion deficit, scrapping last year’s plan for a surplus ($200 million) in 2024-25. Return to balance has...

Newfoundland and Labrador Budget 2024: Higher spending leads to another year of deficits

March 22, 2024

Newfoundland and Labrador projects a $152 million budget shortfall in 2024-25, scrapping surplus plans for the upcoming fiscal year. Revenues...

Saskatchewan Budget 2024: Record spending ends surpluses

March 21, 2024

A $483 million deficit now replaces the previous billion-dollar surplus projection in 2023-24 after an unexpected surge in crop insurance...

New Brunswick Budget 2024: Planning a surplus for the seventh year in a row

March 20, 2024

New Brunswick projects a $41 million surplus in 2024-25—marking the seventh year it’s kept the books in the black.

See all Provincial Outlooks & Fiscal Reports

Forecasts & Data

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