Yesterday the OECD released its estimate of the economic impact of COVID-19 lockdown policies around the world. The sobering conclusion of the OECD’s work is that the initial direct impact of the shutdowns could be a decline in the…
In an emergency meeting last Friday, the Bank of Canada lowered the overnight target rate by 50 basis points rate to 0.25%. Meanwhile, it also launched two new programs to restore liquidity to financial markets. The…
The Norwegian Krone was one of the great victims of the combined catastrophe created by both COVID-19 and the oil price collapse. Oddly, the Canadian dollar has been weak, but not nearly as much as the NOK. As a result, CAD/NOK…
Canadian employment insurance claims surged to 500 thousand last week. This is a country with one-tenth of the population of the US. This number is important in two regards. First, it forewarns of a violent collapse in…
Highlights Policy Responses: The COVID-19 pandemic has become a full-blown global crisis and recession. Governments and central bankers worldwide are now responding with aggressive monetary easing and fiscal stimulus. Markets will not…
The combined impact of COVID-19 and the Saudi-Russian oil war will be particularly challenging for the Canadian economy. Energy represents nearly 20% of Canadian exports and the breakeven price for Canadian oil sands producers is…
We expected the Bank of Canada to cut rates this morning, but we did not anticipate 50bps of easing. In response to the BoC move, the Canadian OIS curve shifted down for the near months, but the yearend expected short rate…
The Canadian S&P/TSX venture index is mostly composed of very speculative stocks, with an overweight allocation in resources and energy. This combination makes this index highly sensitive to investors’ expectations…
Until now, the Bank of Canada was torn. On the one hand, weaknesses in the industrial sector and retail sales have been depressing our Canadian Economic Diffusion Index, arguing that the recent rebound in nominal GDP growth would…
Highlights The elevated uncertainty about global growth stemming from the COVID-19 virus in China has not only made investors more anxious, but central bankers as well. This means that, only six weeks into the year, policymakers may…