OTTAWA (Reuters) – The Bank of Canada has abandoned 18 months of warnings that interest rates will one day have to rise, saying on Wednesday that a soft economy and persistently weak inflation mean there is as much chance of a rate cut as a rate hike.
The surprise policy shift, which knocked the Canadian dollar to a one-week low and sent bond prices higher, came in a statement in which the central bank kept its key rate at 1.0 percent and dropped any hint of an eventual rate increase.
OTTAWA, Oct 23 (Reuters) – The Bank of Canada abandoned on
Wednesday an 18-month stretch of rate-hike talk in a dramatic
policy shift that highlighted lower-than-expected growth and the
risk of persistently weak inflation.
In a statement following its latest monetary policy meeting,
the central bank held its key interest rate at 1.0 percent, the
level it has been at for over three years.
OTTAWA, Oct 22 (Reuters) – Canada’s final budget figures for
the fiscal year that ended in March show a deficit of C$18.9
billion ($18.3 billion), slightly higher than a government
estimate released in May, but much lower than the forecast it
released in its March budget.
In a preliminary report on May 31, the Finance Department’s
Fiscal Monitor estimated a shortfall of C$18.3 billion for the
2012-13 year, while the government’s annual
budget released on March 21 had projected the deficit would be
OTTAWA, Oct 22 (Reuters) – Canadian retail sales rose
modestly in August, their second consecutive monthly rise,
according to Statistics Canada data on Tuesday that pointed to
similarly modest economic growth for the month.
The 0.2 percent rise in retail sales just missed the 0.3
percent consensus in a Reuters survey of analysts, after a
downwardly revised 0.5 percent rise in July. Excluding motor
vehicle and parts dealers, sales rose 0.4 percent, beating
street expectations of a 0.2 percent gain.
OTTAWA, Oct 18 (Reuters) – Ontario doctors have no right to
unilaterally withdraw life support from a patient if the family
objects, the Supreme Court of Canada ruled on Friday in a case
that centered on a Toronto man who has been in a coma since
The wife of Hassan Rasouli, a Shi’ite Muslim, had objected
on religious grounds to the doctors’ decision that her husband’s
life support should be withdrawn as it was of no medical
benefit, arguing that if death can be prevented, it should be.
OTTAWA/TORONTO, Oct 18 (Reuters) –
Canada’s annual inflation rate held steady last month, while
underlying price pressures were also unchanged, suggesting the
Bank of Canada has plenty of room to maintain its low interest
Annual inflation was 1.1 percent in September, the same as
the month before, Statistics Canada said on Friday, slightly
higher than economists’ expectations for 1.0 percent.
OTTAWA (Reuters) – Boeing Co (BA.N: Quote, Profile, Research, Stock Buzz) is still very much engaged with South Korea over the possible sale of F-15 fighter jets, despite Seoul’s move last month to restart a multibillion-dollar tender process, a senior Boeing executive told Reuters on Thursday.
The company also said the partial U.S. government shutdown would have had more significant ramifications if it had lasted longer, but saw no long-term effect from the 16-day hiatus in operations that ended overnight.
OTTAWA (Reuters) – Canada’s Conservative government on Wednesday promised to introduce legislation that will require balanced budgets except during economic crises, and renewed a pledge to balance its books by 2015.
It also said it would soon wrap up free trade talks with the European Union, and announced that Prime Minister Stephen Harper would travel to Brussels on Thursday “with the goal of concluding the … negotiations.”
OTTAWA, Oct 15 (Reuters) – Canada’s Conservative government
on Wednesday highlighted a populist, pro-consumer approach ahead
of a 2015 election, but says it will continue to push for more
jobs and economic growth.
Addressing members of his Conservative caucus ahead of a
policy speech that will outline government priorities for the
second half of its 4-1/2-year mandate, Prime Minister Stephen
Harper said the government planned moves on “choice, fair
treatment, competitive prices.”
OTTAWA, Oct 16 (Reuters) – Canadian manufacturing sales
unexpectedly fell in August, likely dampening economic growth in
the month as the outlook for the sector remains murky in light
of the fiscal standoff in its top market, the United States.
Factory shipments sank 0.2 percent from July to a seasonally
adjusted C$49.5 billion ($47.6 billion) in the month, dragged
down by weakness in the vehicle assembly and food industries as
well as an outsized drop in the small jewelry and silverware
sector, Statistics Canada said on Wednesday.
Analysts surveyed by Reuters had predicted a 0.2 percent
gain in August. Eleven of 21 industries registered setbacks.
The volume of sales, used in calculating gross domestic
product, fell 0.3 percent.
The report suggests manufacturing will contribute little to
monthly GDP and supports the Bank of Canada’s move to downgrade
its growth forecast for the third quarter to between 2.0 and 2.5
percent from 3.8 percent, annualized.
“Manufacturing has stagnated in 2013 and not much positive
momentum should be expected over the balance of the year as the
prospects of a healthy recovery in the U.S. into the fourth
quarter look precarious,” said Mazen Issa, an economist with TD
After weeks of bitter fighting, U.S. lawmakers prepared on
Wednesday to put forth a proposal to raise the debt limit and
reopen a partially shuttered government in hopes of avoiding a
historic default which could throw the economy back into
Canada sells about 75 percent of its exports in the United
“Even if a short-term deal is brokered to extend the
deadline into early next year, uncertainty will hang in the
balance leaving the Canadian manufacturing industry in limbo,”
Issa said in a note to clients.
Year on year, sales were up by just 0.3 percent in current
dollar terms and down 2.1 percent in volume.
Growth in the Canadian economy has disappointed this year,
Bank of Canada Governor Stephen Poloz said on Friday, and August
trade data released last week showed exports were still not
providing the much-wanted boost in the third quarter.