Canada column for Sunday, Jan. 10/16
THE CANADIAN REPORT
(c) By Jim Fox
Canada will have to “ride out” the economic storm that has plunged the dollar to the 70-cent US range, the central bank governor says.
It will take time to adjust to the shock of low oil prices, said Bank of Canada Governor Stephen Poloz as it causes havoc with the economy.
There is no simple fix but Canada’s flexible exchange rate can soften the blow for some parts of the economy, he said.
The bank can also use “unconventional tools” to limit financial and inflationary threats including lowering the trend-setting interest rate into negative territory.
Canada has lost more than $50 billion in national income since oil prices started their plunge in mid-2014, Poloz said.
This has led to tens of thousands of layoffs in the oil patch, primarily in Alberta, where housing prices have fallen as well.
The dollar’s all-time low was 61.79 cents US in January 2002.
Canada’s public safety minister says airlines don’t need to delay children after a six-year-old boy was stopped by airport security because his name is on the no-fly list.
Ralph Goodale says his department is considering changes to the Secure Air Travel Regulations to help deal with people who have similar or the same names as those on the list.
The father of Canadian-born Syed Adam Ahmed said his son was again stopped while trying to board an Air Canada flight on Dec. 31 in Toronto.
Goodale said he understands the frustration of law-abiding travelers whose plans are interrupted.
News in brief:
- A less-valuable Canadian dollar has spurred sales of houses at more than $1 million in Toronto and Vancouver. The demand in the past year was from foreign buyers, Sotheby’s International Realty said. There were 11,112 homes worth $1 million or more sold in the Greater Toronto Area and 4,578 homes in Vancouver, while houses worth more than $4 million grew the most.
- TransCanada said it intends to file a claim under the North American Free Trade Agreement against the U.S. government over its rejection of the Keystone XL pipeline. The Calgary-based company wants to recover $15 billion in costs and damages, calling the decision arbitrary and unjustified. In a notice of intent, TransCanada said the delay and ultimate decision to deny approval was “politically driven . . . and not based on the merits of Keystone’s application.”
Facts and figures:
The Canadian dollar has fallen to 70.73 cents U.S. while the U.S. dollar returns $1.4138 in Canadian funds, before bank and credit card exchange fees.
Canada’s jobless rate was unchanged at 7.1 percent last month as 22,800 net jobs were created, mostly for part-time work.
The Bank of Canada’s key interest rate remains at 0.5 percent while the prime-lending rate is 2.7 percent.
Markets are lower, with the Toronto Stock Exchange index at 12,479 points and the TSX Venture index at 514 points.
The average price of gas is lower at 97.34 cents a liter nationally or $3.69 (Canadian) for a U.S. gallon.
Lotto 6/49: (Jan. 6) 2, 35, 37, 39, 43 and 44; bonus 20. (Jan. 2) 10, 12, 16, 20, 27 and 36; bonus 25. Lotto Max: (Jan. 1) 6, 10, 13, 14, 25, 41 and 46; bonus 8.
- Forty-three harness race horses died when fire raced through Classy Lane Stables in Puslinch, Ontario. The fire marshal’s office is trying to determine the cause of the fire in the stable. The most prominent horse lost was Apprentice Hanover who won about $1 million in purses.
- Catherine McKay, 49, executive director of Saskatoon Sports Council, was arrested for impaired driving causing death after a family of four was killed in a car crash near Saskatoon. Jordan Van de Vorst, 34, his wife, Chanda, 33, and their children, Miguire, 2, and Kamryn, 5, died in the crash.
- A 130-year-old beer found by Nova Scotia treasure hunter Jon Crouse had an “odd, meaty flavor.” The bottle from the A. Keith & Son Brewery was found at the bottom of Halifax harbor and was tested to ensure it was safe to drink. “It’s not the worst I’ve ever tasted,” said bar owner Chris Reynolds.
Jim Fox can be reached at email@example.com