MONEY MASTER

Canadian retail sales showed no growth in November, halting a four-month streak of gains, according to an advanced estimate by Statistics Canada. This follows a  0.6% increase in October , slightly below the  0.7% forecast  by Bloomberg-polled economists. Key Highlights Consumption Weakens:  Retail sales stalling signals waning consumer momentum as the Bank of Canada continues to lower borrowing costs, albeit at a slower pace. Bank of Canada Rate Cuts:  Since June, the central bank has reduced rates by  175 basis points , with another  50 basis points  cut last week. Policymakers are expected to continue easing early next year. Subsector Performance: Automotive Sales Lead Gains:  Sales increased at both new and used car dealerships in October. Core Retail Sales:  Excluding gas stations and car dealers, core sales rose  0.2% , driven by furniture, electronics, and personal care. Gas Station Sales Decline:  Receipts dropped for t...

The Canadian dollar (loonie) is experiencing its worst losing streak in over seven years, driven by increased speculation that the Bank of Canada (BOC) will accelerate interest rate cuts following weaker-than-expected inflation data. The loonie fell as much as 0.3% against the US dollar , reaching a low of C$1.3839 before partially recovering. The September consumer price index (CPI) report showed inflation growing at its slowest annual pace in over three years, falling below the BOC's 2% target . This led to a rally in Canadian debt markets and heightened expectations of more aggressive monetary easing. Swaps traders are now pricing in 45 basis points worth of rate cuts at the BOC’s upcoming meeting on Oct. 23 , up from 39 basis points just a day earlier. Economists, including Jayati Bharadwaj from TD Securities, have noted the increased likelihood of a half-point rate cut , given the weak inflation data. While the loonie may continue to decline, Bharadwaj identified C$1...

Canada's economic growth in the third quarter is projected to be significantly weaker than the Bank of Canada's (BOC) forecast of 2.8% annualized growth, with economists suggesting it may come in at less than half of that estimate. Sluggish consumer spending, rising unemployment, and slower-than-expected export growth are contributing factors to the downgraded outlook. Key Takeaways: Lower Growth Forecasts and Rising Risks : The Bank of Canada had predicted a 2.8% GDP growth for the third quarter, driven by lower borrowing costs, increased exports, and higher household spending. However, economists now expect growth to be around 1% to 1.5%, reflecting weak consumer spending and a struggling labor market. If these projections hold, the central bank may be forced to consider larger interest rate cuts to stave off a potential recession. Challenges in the Labor Market : The labor market has shown signs of strain, with unemployment hitting 6.6% in August, the highest rate in seven y...