Canada column for Sunday, Jan. 22/17
THE CANADIAN REPORT
(c) By Jim Fox
Canada’s dollar slipped in value after the central bank warned further interest rate cuts are possible amid uncertainty surrounding U.S. President Donald Trump’s potential protectionist policies.
Bank of Canada governor Stephen Poloz said there are concerns about the Canadian economy deteriorating as the dollar fell more than one cent to below 75 cents U.S. coupled with falling oil prices.
Another concern were comments by Trump hinting he might be in favor of a weaker U.S. dollar.
Poloz warned there would be “material consequences” for trade if protectionist policies come into effect under Trump between the world’s two largest trading partners.
For now, the central bank has left its trendsetting interest rate at 0.5 percent where it has been since July 2015.
A rate cut “remains on the table” and it will be there as long as downside risks are present, Poloz said.
Canada’s annual rate of inflation rose to 1.5 percent last month, up from 1.2 percent in November, but was a smaller increase than expected as lower food costs helped offset gasoline price increases.
Interest by Americans in Canadian property with the election of President Donald Trump is growing.
Royal LePage real estate said U.S. traffic on its website surged 329 percent the day after the U.S. election and has climbed 210.1 percent year-over-year after Trump’s victory.
Three-quarters of the inquiries concerned residential properties, primarily in Ontario, British Columbia and Quebec.
“With our country’s ever-growing global reputation as a financially sound, happy and culturally tolerant place to raise a family, it is not surprising that interest has moved from a place to play, to a potential place to live and work,” said Royal LePage president and CEO Phil Soper.
News in brief:
- Outspoken multi-millionaire businessman and TVpersonality Kevin O’Leary has joined the race seeking the leadership of the Conservative Party. O’Leary, 62, joins packed field of 14 candidates seeking to succeed former Prime Minister Stephen Harper whose government was defeated by the Liberals in October 2015. The party will vote for the leader on May 27.
- Restaurant Brands International, parent company of Tim Hortons and Burger King, will launch an order-and-payment app nationwide this spring at its 4,000 outlets. It will allow customers to order and pay in advance on their smartphones without lining up at a cashier and follows a similar move by Starbucks. McDonald’s restaurants in Canada also have self-serve kiosks.
Facts and figures:
The Canadian dollar is lower at 75.11 cents U.S. while the U.S. dollar returns $1.331 Canadian, before exchange fees.
The Bank of Canada’s key interest rate is steady at 0.5 percent while the prime-lending rate is 2.7 percent.
Stock markets are higher, with the Toronto exchange index at 15,539 points while the TSX Venture index is 798 points.
The average price for gas in Canada is lower at $1.089 a liter or $4.13 (Canadian) for a U.S. gallon.
Lotto 6/49: (Jan. 18) 10, 17, 20, 24, 33 and 35; bonus 28. (Jan. 14) 1, 6, 19, 30, 32 and 44; bonus 33. Lotto Max (Jan. 13) 2, 8, 24, 30, 31, 38 and 40; bonus 42.
- U.S. wineries are launching an international trade complaint against British Columbia’s decision to sell only its wine in grocery stores. “The United States simply seeks equal opportunities to market our wines, consistent with Canada's international obligations,” said acting U.S. Agriculture Secretary Michael Scuse.
- Shell plans to seal two exploration wells off Nova Scotia, saying they don’t have the potential for “commercial quantities of oil.” It will abandon the Monterey Jack and Cheshire Deepwater wells, resulting in a setback for the province looking to tap into offshore riches. Shell still has an option to drill additional exploration wells if desired.
- New Brunswick and Sears Canada will be partners in two business centers. The provincial government will provide about $8.7 million for the centers in Saint John and Edmundston. They will create about 900 jobs. Sears executive chairman Brandon Stranzl said the Canada-based teams will help improve customer service now based mostly in the Philippines.
Jim Fox can be reached at email@example.com