Inflation continued to accelerate in May, reaching a level not seen since 1983. The high level of inflation continues to be mainly due to a handful of components: gasoline prices, food prices, homeowners’ costs, utilities costs and motor vehicle prices. Altogether, these five items are responsible for about 5.8 percentage points of the 7.7% inflation rate.
Insolvencies remained low in April, as low interest rates and the continued economic recovery with sustained employment gains are holding them back. However, they could be bottoming out, with the rise in insolvencies so far this year slightly stronger than suggested by seasonal patterns.
As expected, the Bank of Canada increased its policy rate by 50bp to 1.00% and announced it would continue quantitative tightening. The key message in today’s decision is that the central bank stands ready to be more aggressive in its fight against inflation. Read more on our Insights blog!
Inflation continued to accelerate in April, reaching a level not seen since 1983. The high level of inflation continues to be mainly due to a handful of components: gasoline prices, food prices, homeowners’ costs, utilities costs and motor vehicles prices.
National house prices declined for the first time since the start of the pandemic in April. However, despite a sharp moderation in April as interest rates started to increase, the level of activity in the housing market remains well above pre-pandemic.
Today’s Labour Force Survey data shows that job gains were modest and below expectations after a rebound in employment following the Omicron wave. Nevertheless, the unemployment rate reached a new record low of 5.2%. These are the signs of a mature labour market where most of the post-pandemic adjustment has already happened.
Today’s release of the GDP for February shows that the hit to the economy from the Omicron wave was minor and short-lived. The data shows that the economy had significant momentum going into the second quarter of 2022, with growth estimated at 5.6% q-o-q ar. in the first quarter.