Economy and Markets

The Canadian economy is still slowing as the lagged impact of earlier interest rate increases materialize. Gross domestic product edged higher in Q4 2023 but once again not fast enough to keep up with surging population growth. Per-person output (a key indicator of household living standards) fell for a sixth straight quarter (by our count) […]

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.

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.

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

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

The global economic growth backdrop has continued to slow as the lagged impact of aggressive central bank interest rate hikes continue to build alongside a continued squeeze on household purchasing power from the earlier rise in food and energy prices.

Elevated policy rates and tight financial condition continue to slow consumer spending in Canada, the euro area and the UK

Central banks are on pause as surging term bond yields tighten financial conditions further. Canadian population growth is complicating interpretation of macroeconomic data, but there are signs of softening under the surface.

The global economic backdrop is darkening as growth slows in China while elevated interest rates weigh on Canada

Headwinds from higher interest rates and a slowing global economy are building. Canadian GDP edged 0.2% lower in Q2 of this year and early reports are pointing to another decline in Q3. Some factors that weighed on output in Q2 will prove ‘transitory’—including disruptions due to wildfires and a strike by federal workers in April. […]

Robust economic data seemed to bring sunnier days in July. For the most part, global equity indices inched higher as recession fears eased.

Resilient economic growth and sticky inflation are pressuring central banks to push interest rates higher, even as headwinds from higher prices and debt payments build.