Yahoo finance news canada12/11/2023 ![]() Employers are somewhat reluctant to let go of workers, for fear of not being able to fill vacant positions once the economy begins to recover next year," Stratton said. "Given these type of conditions, we actually don't expect employment to decline overall. Stratton said while recessions traditionally are associated with significant job losses, the current situation is different as businesses need to balance softening demand against a tight labour market. Still, the report noted that one of the "wild cards" in the forecast is the Canadian labour market, which has remained tight despite concerns about an economic slowdown. Deloitte said goods sensitive to interest rates, such as household furnishings and appliances, will be hit hardest, and that discretionary spending on services such as communication, recreation, accommodation and food will also decline.ĭeloitte now expects real GDP growth to fall in the first and second quarters of the year, with zero growth predicted for the third quarter this year. Unfortunately, interest payments are set to continue to increase over the coming year, squeezing household budgets and leading to yet more declines in consumer spending."Ĭonsumer spending has already dropped off, but the declines will not be felt equally across all categories. ![]() "Given the increase in interest payments, it’s not terribly surprising that real household spending fell in the third quarter. "Households are being battered by the double whammy of high inflation and rising borrowing costs," the report said. That, along with slowing economic growth in the U.S., "will hit Canada hard", the Deloitte report said. ![]() Interest payments on household debt in Canada have since soared, increasing by 16.2 per cent on annual basis in the third quarter of the year, the largest increase on record. At the time the forecast was released, the Bank of Canada had hiked its benchmark interest rate by 300 basis points.īut the central bank wasn't done in its effort to crackdown on inflation, and it raised the benchmark rate an additional 100 basis points, bringing the overnight rate to its current position of 4.25 per cent. "While we were previously projecting a recession in the fall of last year, the conditions have worsened a bit and so we're projecting a slightly longer recession now."ĭeloitte had previously forecast in September that Canada would enter a short-lived recession, with growth stalling in the first quarter of 2023 before returning to positive territory in the second quarter of the year. "It's fair to say that 2023 is shaping to be a rocky year for the Canadian economy," Deloitte Canada's National Economic Advisory Leader Trevin Stratton said in an interview with Yahoo Finance Canada. economy will drag down economic growth in Canada for three consecutive quarters, resulting in a 0.9 per cent contraction in GDP growth in 2023. economy enters a slowdown, according to a new report from Deloitte Canada.ĭeloitte Canada's latest Economic Outlook, released on Tuesday, says that the impact of rising interest rates and a slowing U.S. (THE CANADIAN PRESS/Sean Kilpatrick)Ĭanada will enter a deeper recession than previously expected this year as the Bank of Canada's rapid interest rate hikes take hold and the U.S. Next week, Cenovus Energy ( CVE.TO)( CVE), Baytex Energy ( BTE.TO)( BTE), and MEG Energy ( MEG.TO) are set to kick off the second-quarter earnings season for Canadian producers.Deloitte Canada's latest Economic Outlook, released on Tuesday, says that the impact of rising interest rates and a slowing U.S. ![]() "In other words, the performance of medium and heavy grades has a material impact on the earnings of production companies and nations," Johnston said. While prices for light sweet crude grades WTI and Brent are most closely watched by investors, he notes these make up only a narrow portion of the overall market. "It's really narrow," Rory Johnston, founder of Commodity Context, told Yahoo Finance Canada about the key differential. traded between US$11.85 and US$12.05 a barrel below WTI, according to the brokerage CalRock. ![]() On Monday, WCS for August delivery in Hardisty, Alta. WCS hit a record discount of more than US$50 a barrel below WTI in October 2018 when a lack of space on export pipelines and refinery maintenance led to a glut of crude in Alberta. Due to its lower quality, heavy oil such as WCS trades at a discount to light sweet crudes like WTI. ![]()
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