New labour force data data, upcoming UWES events, and more!
Written By: Peter Robertson and Syed Afridi
Canada’s Economy at a Glance
Economics Society News, Events, and Articles
- Our weekly study lounge is running every Tuesday from 7-9PM in HH 2034
- This Tuesday Prof Rajsic is hosting a Speaker Series event from 1-230PM in AL 208
- The deadline to order economics hoodies is June 13 – order one here!
- Check out how you’re doing in the stock contest update below!
News and Noteworthy
Almost a quarter of Canadians report eating less than they should due to rising prices: survey
A new survey conducted by Mainstreet Research has shown that nearly a quarter of Canadians say they have been eating less than they should because of rising food prices. This figure almost doubles when looking at households making under $50,000 per year. As food prices continue to rise, food banks are struggling to keep up with increased demand as usage has surged by as much as 25% in some parts of Canada. Read more.
Typical mortgage payment could be 30% higher in 5 years, Bank of Canada warns
The Bank of Canada warned of the increased risk posed to the economy by elevated debt levels due to the price of real estate on Thursday. About two thirds of Canadians are homeowners, and approximately half have some type of mortgage attached to their homes. 1 in 5 households are now “highly indebted” meaning they have a debt-to-income ratio of 350%, up from 1 in 6 before the pandemic and 1 in 14 in 1999. As interest rates continue to be hiked, mortgage rates are expected to rise to 4.5% by 2025. Read more.
Posthaste: Recession risk rises as Canadian economy runs out of room to grow
Experts say the risk of recession in Canada is rising as inflation rates rise and interest rate hikes loom. RBC’s latest macroeconomic projection expects GDP growth to decline to 4.2% in 2022 and 1.9% in 2023, from the growth of 4.5% seen in 2021. Travel and high commodity prices are what are currently keeping the Canadian economy growing, but outside of those industries the outlook is significantly worse. Read more.
Iran’s currency hits new record low amid nuclear deal uncertainty
Iran’s national currency has hit new all-time lows amid developments that have cast doubts about the complete restoration of the nuclear deal and lifting of the United States sanctions.The rial has fallen to historic lows against the US dollar in recent days, trading at rates close to 330,000 in the open market on Saturday and Sunday, the first two days of the working week in Iran. Read More.
US: Gasoline average price tops $5 per gallon in historic first
High gasoline prices are a headache for President Joe Biden and congressional Democrats as they struggle to maintain their slim control of Congress with midterm elections coming up in November. Biden has pulled on numerous levers to try to lower prices, including a record release of barrels from US strategic reserves, waivers on rules for producing summer gasoline, and leaning on major OPEC countries to boost output. Yet fuel prices have been surging. Read More.
Eurozone interest rates set to rise for first time in 11 years
The European Central Bank (ECB) has said it intends to raise interest rates for the first time in more than 11 years next month as it tries to control soaring inflation in the eurozone.The ECB said it would raise its key interest rates by 0.25% in July, with further increases planned for later in the year. Read More.