Canada Archives - Economy Watch

OECD Tells Canada to Cool Off Housing Markets

The Organization for Economic Cooperation and Development (OECD) fears that Canadian home sales may be ramping up to a bubble. According to the OECD, the Canadian government needs to cool off the overheating housing markets in Toronto and Vancouver.

Otherwise, external economic hardships coupled with favorable buying conditions could cause real estate prices to increase disproportionately, create a bubble, and then devastate the Canadian economy when it bursts.

Canadian Lenders Feel Sting of Low Oil Prices and Slow-Growth Economy

Canada’s major banks, such as Toronto Dominion Bank and Royal Bank of Canada, failed to meet profit targets as the economy struggles, according to Reuters. Banks have been especially hit hard from energy loans, but banking leaders are more concerned about the overall slowdown of the economy. While the situation concerns many banks, analysts do not foresee an apocalyptic scenario.

O Canada is Growing Again

Canada reported its monthly GDP estimate for September, and at the same time, provided its first estimate of Q3 GDP. The Great Graphic, created on Bloomberg, shows both time series.

The yellow line depicts the monthly GDP and the quarterly estimate is the white line. Clearly, they track each other, as one would expected. The good news is that after contracting in the first two quarters of the year, the Canadian economy expanded by 2.3% in Q3.

New Liberal Government Elected in Canada

Conservative Prime Minister Stephen Harper was voted out of office during October elections, including many Parliament officials. Liberal Party leader Justin Trudeau, a former teacher and seven-year Parliament member, was elected prime minister. Members of his party won 184 national seats, comprising a new majority in Parliament.

Market Participants May Want to Look Past Canada’s Election Outcome

Canada’s national election is Monday. The latest opinion polls show a virtual dead heat between the governing Conservatives and Liberals.

Two main issues dominate. The first is the economy. Canada is struggling. Although the contraction period is over, growth is fragile. The economy contracted for the first five months of the year. Unemployment has steadily risen over the past year. Last month it stood at 7.1%, which matches the highest level since the end of 2013. It was 6.6% in January.

Canadian Dollar Falling Like a Leaf

The Canadian dollar is the worst performing major currency over the past month. It has lost nearly 4.5% against the US dollar. That brings its year-to-date loss to almost 12%.

Canadian Economy Contracted in May

According to Canadian statistics, the economy shrank 0.2 percent in May, falling below already low expectations of zero growth, according to Business Insider. The economy continues to suffer due to low oil and commodity prices.

Trouble Looms for Harper as Canadian Economy Tumbles

The Canadian economy is on the brink of a recession, spelling trouble for Prime Minister Stephen Harper as he seeks a fourth term in office this year, according to Reuters. Currently, the New Democratic Party is taking the leading over Harper’s Conservative Party. Voting takes place in October.

Is Canada Going Into Another Recession?

For four straight months, Canada’s economy has experienced a slight decline. This has led many in the financial sector to question whether Canada may be entering another recession.

Investment Picks Up in Canadian First Quarter

Small business investment increased in the first quarter, according to new data from PayNet, a sign that the Canadian economy is improving. The exceptions are Saskatchewan and Alberta, two provinces still reeling from the shock of low oil prices. Both provinces saw a 1.0 percent decline in investment, and loan delinquencies surged by 2.0 percent.