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Written By: Benjamin Pipicelli, Lexx Thomson, & Dorje Gyaltsen
Economics Newsletter – September 15, 2023
Canada’s Economy at a Glance
Author’s Commentary
Canadian Savings on a Decline
Declining energy prices were a significant factor in quelling Canadian and US headline inflation in the past year, but in the case of oil and gasoline, we’ve reached a turning point. Already, its downward pull on 12-month inflation rates has started to diminish, a key reason why the headline inflation rate ticked higher in Canada in July.
Supply improvements drove some of the disinflation in the past year. Now higher interest rates that reward saving and make borrowing more costly, and slowing job and wage growth that constrain incomes, should ease demand enough to cool inflation ahead, even if we end up paying a bit more at the pumps.
News and Noteworthy
After years of struggles, this company cracked the TSX Top 30 with 522% stock jump
After years of struggles that saw the company fall to the brink of bankruptcy and sell off a significant portion of its business, Bombardier Inc. has found itself among the top-performing TSX stocks of the last three years. The Montreal-based company came in at No. 13 on the 2023 TSX 30 list, a ranking of the top 30 top-performing stocks over a three-year period based on dividend-adjusted share price performance. This marks the first time that Bombardier has appeared on the list, which was first compiled by the Toronto-based exchange in 2019. Read more.
Canada adds 40,000 jobs in August, unemployment rate unchanged
Canada added 40,000 jobs in August, more than economists had expected, as the unemployment rate remained unchanged at 5.5 percent. Until August, the unemployment rate had increased in each of the previous three months. Analysts polled by Reuters had forecast a net gain of 15,000 jobs in August, and for the unemployment rate to edge up to 5.6 percent from July. Statistics Canada said in its release of the Labour Force Survey on Friday that population growth outpaced the increase in jobs in August. As a result the employment rate, or the proportion of people aged 15 and older with jobs, fell 0.1 percent to 61.9 percent. Read more.
Toronto housing market would stay unaffordable even in deep recession: report
Housing affordability in Toronto would remain strained even in the event of a deep economic recession, a new Desjardins analysis has found, highlighting the challenge ahead in addressing the housing crisis. “After years of being priced out of the market, many prospective Toronto homebuyers now sense an opening with a recession looming. But even in the direst of economic scenarios, we don’t see affordability returning to Canada’s largest city anytime soon,” the report, authored by Desjardins chief economist Jimmy Jean and principal economist Marc Desormeaux, said. Read more.
Joaquin Phoenix and Julianne Moore are among the celebs protesting RBC’s TIFF sponsorship
Hollywood stars are protesting the Royal Bank of Canada’s (RY.TO)(RY) sponsorship of the Toronto International Film Festival (TIFF). Joaquin Phoenix, Julianne Moore, Mark Ruffalo, Rachel McAdams, Adam McKay, and Edward Norton are among more than 200 signatories to an open letter condemning the bank’s actions on climate change. Read more.
Real estate realities slowing rooftop solar growth in Canada
Covering warehouses and shopping malls in solar panels could become as common as equipping office spaces with air conditioning, according to a large-scale Canadian installer. But the realities of commercial real estate may slow the “rapid acceleration” some financial experts are calling for. “In the last three years, I’ve seen pretty significant percentage jumps in terms of solar going on. We’re seeing it on larger and larger properties,” RESCo Energy president Fidel Reijerse told Yahoo Finance Canada. “I don’t necessarily see good solar being rolled out on every roof in a short period of time.” Read more.
Economics Society News, Events, and Articles
– Keep an eye out on our Instagram page @UWEconSoc for updates regarding future events
– Our weekly Economics Study Lounge has begun! Come to HH2034 Project Cube every Monday from 6:30-8:30 pm!
– Check out our latest original article, Breaking Down Barriers: Effective Solutions for Addressing Ethnolinguistic Fractionalization in Côte d’Ivoire written by Sneha Elavarasan!