Retail sales increased more than expected in September, and the preliminary estimate suggests that sales were also robust in October.
To help make credit unions innovation ready, Alberta Central’s Chief Economist Charles St-Arnaud shares his analysis of the latest economic news. These commentaries and insights papers will help you understand what economic trends mean and how they could impact your credit union.
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Inflation decelerated to 3.1% in October, in line with expectations. The lower inflation rate is mainly the result of lower gasoline prices and slower price increases for food. However, service prices accelerated in October.
The Bank of Canada has tightened monetary policy meaningfully in its fight against inflation, raising the policy rate to 5.00%, well into restrictive territory. However, history has shown that it takes between 5 to 7 quarters on average between the moment monetary policy moves into restrictive territory and the start of a downturn, suggesting that the next six months may be the window to observe a more meaningful deterioration in the economy.
Insolvencies declined in September on a seasonally-adjusted basis, likely taking a temporary pause in their gradual rising trend, and remained close to their highest level since the start of the pandemic. As such, proposals (a renegotiation of terms) are above their pre-pandemic levels at the national level and in almost every province.
Today’s Labour Force Survey data points to some softening in Canada’s labour market, with weaker than expected job gains and a rise in the unemployment rate to 5.7%. Moroever, unchanged hours worked suggest that economic activity remained modest in October.