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Greater Niagara Chamber of Commerce

Daily Update: September 19, 2022

Loonie dips below 75 cents U.S. for first time since 2020, industrial product prices up over 10%, raw materials jump almost 18%, and more.

In this edition:

Loonie dips below 75 cents U.S. for first time since 2020

The Canadian dollar has fallen below the 75-cent U.S. mark for the first time since 2020 amid broad U.S. dollar strength.

The loonie fell as low as 74.94 cents in early trading as investors piled into the greenback, the lowest level since early November, 2020.

In spite of the recent relative weakness against the benchmark U.S. dollar, the Canadian dollar is still far-and-away the best performing G10 currency relative to the greenback this year, down 5.01 per cent.

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Industrial product prices up over 10% year-on-year, raw materials jump almost 18%

The Industrial Product Price Index (IPPI) declined 1.2% month over month in August, led by a 6.5% drop in prices for energy and petroleum products, but year over year, the IPPI increased 10.6%. Once prices for energy and petroleum are removed, the drop in other prices falls to 0.3%. Prices of raw materials purchased by manufacturers operating in Canada, as measured by the Raw Materials Price Index (RMPI), fell 4.2% on a monthly basis in August, but increased 17.6% year over year.

Despite the monthly decrease, prices for refined petroleum energy products were 51.1% higher compared with August 2021 and 65.1% higher compared with January 2020. Crude prices have been brought down somewhat as the United States released 22.9 million barrels of oil from its Strategic Petroleum Reserve.

Natural gas prices in Canada fell 19.4% in August, with increased production, pipeline capacity, and unplanned outages all playing a role in the significant price drop. This price movement is unique to Canada, as natural gas prices were high globally.

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U.S. fruit sellers look to Canada for berry production amid drought, rising costs

U.S. fruit sellers are looking north to Canada as severe drought and water shortages continue to wreak havoc on crops in California, the biggest state for agriculture.

American berry giant Driscoll’s has partnered with Sébastien Dugré, co-owner of Massé Nursery in Saint-Paul-d’Abbotsford, Que., to test whether commercial production of blackberries and raspberries is viable in the province.

Quebec’s colder climate can limit berry crops, so growing them on a larger scale is unusual for that part of Canada. Dugré started the trials last year, and was able to harvest almost 80 tonnes of fruit this year.

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Inflation: What economists are expecting from Tuesday’s numbers

Economists are expecting to see a cooldown in Canadian inflation when Statistics Canada releases its latest data on Tuesday morning.

The downward trend would be a continuation from July’s data when the annual inflation rate cooled to 7.6 per cent year-over-year. June’s 8.1 per cent rate was the highest in nearly four decades.

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Focus on Small Business

How your company can encourage innovation from all employees

Harvard Business Review

Companies around the world benefit from the ideas and innovations of their frontline employees to improve their products and processes. The kaizen approach to this, which originated from the Toyota Production System, has been instrumental in driving performance through frontline employee idea generation and implementation. The basic notion behind kaizen is that a continuous stream of hands-on improvements translates into substantial productivity and quality gains over time.

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Through the Daily Updates, the GNCC aims to deliver important business news in a timely manner. We disseminate all news and information we feel will be important to businesses. Inclusion in the Daily Update is not an endorsement by the GNCC.

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