Connect with us
[bsa_pro_ad_space id=12]


Bank of Canada holds interest rate at 1.75%; keeps eye on oil slump, investment



If you like this, share it!

  • OTTAWA — The Bank of Canada is leaving its interest rate unchanged and says the timing of future hikes will depend on factors such as how long the oil-price slump lasts, how well business investment picks up its pace and how much room the economy still has left to grow.

    The central bank’s move Wednesday maintains its trend-setting rate at 1.75 per cent. The decision follows the quarter-point increase at the bank’s previous policy meeting in October.

    Thanks to the strengthened economy, the bank has been on a gradual rate-hiking path for more than a year and has already raised the benchmark five times since the summer of 2017.

    The central bank raises the interest rate to prevent inflation from climbing too high. Heading into Wednesday’s announcement, many market watchers had expected governor Stephen Poloz to wait until at least January before his next rate increase.

    More hikes are on the way, but the bank said the timing of its next one will hinge on changes in global trade policies as well as how higher interest rates from past increases affect consumption and housing.

    The bank also underlined several recent economic developments that it will now take into account.

    “The persistence of the oil-price shock, the evolution of business investment and the bank’s assessment of the economy’s capacity will also factor importantly into our decisions about the future stance of monetary policy,” the bank said Wednesday in a statement.

    On oil, the central bank blamed the steep slide in prices on the combination of geopolitical developments, uncertainty about the outlook for global growth and the expansion of American shale oil production. The price of western Canadian oil, the bank added, has fallen further than other benchmarks because of transportation constraints that have led to production cuts.

    “Activity in Canada’s energy sector will likely be materially weaker than expected,” the statement said.

    Recent data, the bank noted, also show the economy has less momentum heading into the final quarter of 2018. It says it’s related to factors such as a drop in business investment that it largely connects to significant uncertainty around trade last summer.

    The bank expects corporate investment to improve — outside the energy sector — following last week’s signing of the updated North American trade agreement, new federal tax incentives and ongoing pressure from rising demand.

    It will also be watching for positive developments such as more signs the economy can still expand without stoking inflation. The bank pointed to recent downward revisions to gross domestic product data that suggested there’s still some space for non-inflationary growth.

    The bank, which tries to keep inflation within its target band of one to three per cent, noted that October’s inflation reading of 2.4 per cent was above its ideal two per cent bull’s-eye. However, due to weaker gasoline prices, it is now predicting inflation to move down in the coming months by more than its previous forecast.

    The Bank of Canada has estimated it will no longer need to increase the interest rate once it reaches a level of between 2.5 and 3.5 per cent, but Poloz has said this destination range remains “sufficiently uncertain” and could move up or down.

    Andy Blatchford, The Canadian Press

    If you like this, share it!


    Regulators, exporters talk harmonizing standards in Canada, U.S.



    If you like this, share it!

  • WASHINGTON — Life-changing technology breakthroughs could be strangled by red tape at the Canada-U.S. border unless the two countries give innovators one shared set of rules to follow, Treasury Board President Scott Brison said in Washington Tuesday.

    Brison joined Mick Mulvaney, director of the U.S. Office of Management and Budget, to kick off a two-day meeting of the Regulatory Co-operation Council, charged with figuring out new ways to cut through the reams of regulations that pose an ever-present risk to Canada-U.S. trade.

    For a business with a clever new product, having to follow two sets of rules in two different markets can be extremely challenging, especially if the business is small.

    “It makes a lot of sense for us to work together, multilaterally, in developing regulatory approaches that are consistent between our countries, whether you’re talking drones, or AI, or robotics. It is in the interest of the health and safety of our citizens, and the job-creation capacity of our businesses, to work together,” Brison said in an interview.

    One novel idea stakeholders were discussing Tuesday: keep red tape from sprouting in the first place.

    By working together on standards that are very similar, the risk of regulatory differences could be minimized almost to the point that the need for the council — founded in 2011 to cut the countless regulatory roadblocks between the two countries — would one day cease to exist.  

    “If we do a really good job of deepening the regulatory co-operation between U.S. agencies and Canadian agencies, in time the RCC is not really going to be needed,” Brison said. “The objective will be that the level of co-operation between our two agencies is so deep and so instinctive that you won’t need to have another body.”

    The oncoming AI revolution is poised to turn the auto industry on its head, with dramatic changes in how vehicles are built and used sure to be coming fast and furious, said Mark Nantais, president of the Canadian Vehicle Manufacturers’ Association.

    A seamless integration of standards between Canada and the U.S. would help ensure that both countries realize the benefits not only of new technology itself, but the economic prospects it brings, Nantais said.

    “There’s just so much interest in terms of automated vehicles, electric vehicles — everybody wants a piece of that action,” including not only in the building of vehicles, but cutting-edge areas like software, cybersecurity and AI, Nantais told the forum during Tuesday’s panel discussion.

    “But if we really want to be effective in how we bring forward those technologies, we have to make sure we don’t put in place impediments to those technologies.”

    That means ensuring co-operation between agencies, sharing research and knowing when to resist the temptation to do what often comes naturally to big bureaucracies, he said. “In many instances that may not mean regulation at all — that might mean the co-ordination of best practices or non-regulatory approaches.”

    Michael Fitzpatrick, the head of regulatory advocacy, global law and policy for General Electric, told the panel that emerging technologies would be a good area for regulators on either side of the border to work on aligning their rules, since the development of the technology is global in scope.

    But it’s important not to lose sight of the “transactional” nature of business, he added.

    “At the end of the day, businesses are bottom-line, they do cost-benefit every day, and we’re not going to be interested in participating in a three-year process of culture change at the agencies. If you succeed, terrific,” Fitzpatrick said. “The bottom line for businesses are, are there actual regulatory wins that will benefit the economy, consumers and business, and can we see the victories at some regular pace.”

    James McCarten, The Canadian Press

    If you like this, share it!
    Continue Reading


    Get tough with General Motors Trump-style, union head urges Trudeau



    If you like this, share it!

  • WASHINGTON — The head of Canada’s largest autoworkers union wants Prime Minister Justin Trudeau to borrow the tactics of the U.S. president and get tough with General Motors, Donald Trump-style.

    Unifor president Jerry Dias is also urging both countries to hold off signing the new U.S.-Mexico-Canada Agreement on trade and to join forces on a 40-per-cent tariff on GM vehicles built in Mexico. He wants the company to reverse plans to cut more than 14,000 jobs, including 2,500 production workers in Oshawa, Ont.

    “I think both Canada and the United States should put the brakes on immediately,” Dias said as he arrived at the Canadian Embassy in Washington for a meeting with officials to discuss next steps.

    “The ink isn’t even dry and you have General Motors completely violating what it is we are trying to accomplish, so I think both Canada and the U.S. should be saying to General Motors, ‘Listen, you are holding up the signing of this deal, this weight is on your shoulders. You’re the one that’s holding all this up.’ “

    In addition to mothballing the Oshawa plant, the cuts involve shutting down production at four facilities in the U.S, including in Ohio and Michigan. GM plans to end 3,300 production jobs south of the border and do away with 8,000 salaried workers, all in the name of US$6 billion in savings by 2020.

    It’s a sign of more to come, said Dias — GM is clearly focused on moving its manufacturing work away from both countries, including Mexico and China, which means job losses will continue unless both Canada and the U.S. ramp up the pressure.

    A hefty tariff on Mexican-made imports would “get their attention immediately,” he said, even as he acknowledged the contradiction between battling U.S. tariffs on steel and aluminum on the one hand, and joining forces in a similar tactic on the other.

    “It sounds bold, it sounds aggressive, it’s not productive — but we’re dealing with a corporation that doesn’t care,” Dias said. “They’ve watched all this unfold, they listened for 15 months and they don’t care. This is all about their shareholders, it’s all about the board. It has nothing to do with people.”

    Flavio Volpe, president of the Canadian Automotive Parts Manufacturers Association, said while he understands the union leader’s frustrations, adopting Trump’s hardline tactics would be a grievous tactical error at a time when Canada is trying to negotiate a solution to its own tariff impasse with the U.S.

    Canada remains subject to Trump-imposed tariffs — 25 per cent on steel exports and 10 per cent on aluminum — that the U.S. claims are justified on the grounds of national security, and that auto-industry experts acknowledge have made it more expensive to build cars in both countries. They’re called “Section 232 tariffs,” for the part of an American trade law that allows them.

    “You can’t be hoping for the benefits of the USMCA, fighting Section 232 tariffs and endorsing company-specific tariffs at the same time,” Volpe said in an interview.

    “Jerry is a very important and positive part of the Canadian automotive fight, but that tariff idea is wrong.”

    Trump, whose 2016 election victory came in large part from blue-collar supporters in the U.S. Midwest who cheered his promise to bring jobs back to the hard-hit manufacturing sector, has threatened to withdraw support for GM if it didn’t reverse course. 

    He doubled down on that threat Wednesday, saying the General Motors cuts have prompted fresh discussions about slapping tariffs on auto exports.

    “The president has great power on this issue,” Trump tweeted. “Because of the GM event, it is being studied now!”

    The Trump-christened USMCA, increasingly known north of the border as the “new NAFTA,” is due to be signed later this week when world leaders gather in Argentina for their annual G20 meetings. That signing is widely expected to go ahead despite the outstanding tariff issues.

    But the controversy over GM runs the risk of overshadowing the long-term benefits for all three countries of an agreement that experts insist is about setting the stage for the future of North Anerican trade and manufacturing, rather than solving its immediate challenges.

    In an interview earlier Wednesday with CNN, Michigan Rep. Debbie Dingell, a Democrat, suggested the cuts could cause her to withdraw her support for USMCA, which still requires ratification by both houses of Congress. 

    “We need to be supporting companies that are creating jobs here,” Dingell said. “I’m not sure they showed an ounce of support or caring for the working men and women that were impacted by these announcements this week.”

    Emotions are running high, particularly in those communities most deeply affected by the GM news, Volpe said. But votes to ratify the agreement on Capitol Hill are likely several months off, by which time the immediacy of the news will have faded.

    In announcing the cuts Monday, General Motors said its retooling to position the company for the coming dominance of electrified, interconnected and automated automobiles.

    There’s no reason why that work can’t happen in Canada, Dias said.

    “They’re not talking about transforming from cars to spaceships. It’s still a car; it’s the exact same car, it’s just got different technology inside of it,” he said. The company launched a high-tech research centre last year in Markham, Ont., not far from the Oshawa plant, he added. 

    “Certainly they can develop that technology, and then implement it in a car they’re assembling five miles down the road.”

    — Follow James McCarten on Twitter @CdnPressStyle

    James McCarten, The Canadian Press

    If you like this, share it!
    Continue Reading

    december, 2018

    wed21nov - 21decAll DayAlberta Sports Hall of Fame and Museum - Deck the Hall 31 Days of Giving-31 Days of giving(All Day) Event Organized By: Alberta Sports Hall of Fame and Museum

    sat15dec10:00 am- 4:00 pmParkland Garden Centre Craft and Market Sale10:00 am - 4:00 pm

    sat15dec12:00 pm- 6:00 pmArtisan Market Sale for Nuit Blanche Winter CarnivalArtisan Market12:00 pm - 6:00 pm

    sat22dec10:00 am- 4:00 pmParkland Garden Centre Craft and Market Sale10:00 am - 4:00 pm

    mon31dec - 1jandec 317:00 pmjan 1- 2:00 amBlack & White ballRed Deer\'s Party of the Year!7:00 pm - (january 1) 2:00 am

    mon31dec - 1jandec 317:00 pmjan 1- 1:00 amOne Eleven Grill New Year's Eve with Claude Godin and his Groove EnsembleCall 403.347-2111 to reserve for New Year7:00 pm - (january 1) 1:00 am