In this edition:
- What are economists expecting from Wednesday’s Bank of Canada rate decision?
- Canada to open an export development office in Jakarta
- Gross domestic product, income and expenditure, nearly unchanged in second quarter 2023
- Up to 80 projects in Ontario receiving funding through the Rural Economic Development Program
- Premier Ford shuffles cabinet after housing minister resigns
- Reading Recommendations: Finance and Economy
What are economists expecting from Wednesday’s Bank of Canada rate decision?
Economists are calling for the Bank of Canada to hit pause on interest rate hikes this week as the economy shows signs of overall cooling.
Most economists surveyed by Bloomberg expect the central bank will keep its overnight lending rate at five per cent when it announces its next rate decision on Wednesday.
The nearly unanimous call comes after the Canada’s gross domestic product (GDP) shrank at a 0.2 per cent annualized pace in the second quarter of 2023, according to the latest Statistics Canada figures – signalling that an economic slowdown has begun.
Canada to open an export development office in Jakarta
Today, Prime Minister Justin Trudeau, during his visit to Indonesia, announced the opening of an export development office in Jakarta. He also introduced Paul Thoppil as the Indo-Pacific trade representative, tasked with assisting Canadian businesses in entering new markets within the region.
Trade Minister Mary Ng emphasized the significance of Canadian companies expanding in this region, emphasizing the positive impact on job creation in Canada. Ng further noted that Jakarta would serve as the base for the newly appointed trade representative, Paul Thoppil.
Gross domestic product, income and expenditure, nearly unchanged in second quarter 2023
Real gross domestic product (GDP) was nearly unchanged in the second quarter, following a 0.6 per cent rise in the first quarter. The slowdown was attributable to continued declines in housing investment, smaller inventory accumulation, as well as slower international exports and household spending.
Increased business investment in engineering structures and higher government spending were among the few components that contributed to growth. Final domestic demand rose by 0.3 per cent, a similar increase to that seen in the first quarter of 2022.
Housing investment fell 2.1 per cent in the second quarter, the fifth consecutive quarterly decrease. The decline was led by a sharp drop in new construction (-8.2 percent). Renovation activities also fell by 4.3 per cent
Up to 80 projects in Ontario receiving funding through the Rural Economic Development Program
The Ontario government is investing over $4.3 million in up to 80 projects across the province through the latest intake of the Rural Economic Development (RED) Program. The RED program supports projects that diversify rural economies, retain skilled workers, and create jobs in local communities.
The RED program provides cost-share funding support towards activities that create strong rural communities. This includes funding assistance to build local capacity and improve job prospects.
Premier Ford shuffles cabinet after housing minister resigns
Ontario Premier Doug Ford reshuffled his cabinet following Housing Minister Steve Clark’s resignation amid controversy over Greenbelt land housing selection and an ethics violation by the Integrity Commissioner. Clark, backed by Ford, resigned due to becoming a “distraction” from housing crisis work but remains MPP for Leeds-Grenville-Thousand Islands and Rideau Lakes.
The Premier later announced changes: Paul Calandra becomes Minister of Municipal Affairs and Housing. Caroline Mulroney and Prabmeet Sarkaria switch roles; Mulroney becomes Treasury Board President, and Sarkaria takes over Transportation, addressing project delay issues.
Did you know?
The Quebec town, Saint-Louis-du-Ha! Ha!, is a Guinness World Record holder for the most exclamation marks in a town name — it has two.
Focus on Finance and Economy
Why seven per cent mortgage rates would be unsustainable
Robert McLister; The Globe and Mail
If you’re renewing your mortgage or riding a floating rate, you’re probably feeling a sharp pain in your pocketbook region.
Folks renewing five-year fixed terms from 2018 are getting whacked with 260-plus basis-point rate increases. (One basis point is one-one hundredth of a percentage point.)
As for adjustable-rate borrowers, they’ve already seen their rates explode by 475 bps. And the market’s pricing in a coin flip’s chance of another hike this fall.
The overwhelming majority of floating-rate and renewing borrowers are now paying rates around 6 per cent or more, with lesser qualified borrowers north of 7 per cent.
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.
