The wait for the Bank of Canada to move is over; now the waiting for the next steps begins.
Wednesday's rate increase by the bank did not come as a surprise. In its December interest-rate setting announcement, the bank noted that it would be guided by incoming data before raising its target for the overnight rate. Well, the data have spoken. Headline inflation nudged above the bank's 2-per-cent target in November, coming in at 2.1 per cent, and two of the bank's preferred measures of core inflation, CPI-trim and CPI-median (which remove volatile components from the index), moved up closer to 2 per cent.
The bank also noted the robust pace of business investment, and the positive outlook for future investment as factors…
Are we entering the post-NAFTA world? It certainly looks that way.
The markets finally woke up to this on Wednesday, after sleepwalking for the past year, as bond yields and stock prices sank and the dollar took a hit on news that the Trump administration is preparing to pull the plug on the North American free-trade agreement, maybe even before the next round of negotiations slated for Montreal at the end of the month.
Markets have a way of ignoring facts, or at least taking a rosy view in complex situations of government-to-government trade policy. In this case, the somnambulism was based on misplaced optimism that trade negotiators would be able to solve the NAFTA problems, blithely ignoring the significance of…
Although Canadians today are richer than ever, the gap between average and median household wealth has grown also.
By this measure, the main drivers of wealth inequality between Canadian households over the 2005-16 period have been rising real estate prices and an aging population, according to the 2016 Survey of Financial Security released by Statistics Canada.
However, surveys of financial security ignore wealth accumulated in public plans such as the Canada Pension Plan or Old Age Security. These programs reduce the need for low-income households to save privately for their retirement, and thus exacerbate the perceived private-wealth inequality.
The good news is that over the 2005-16…
