TD/ Canada Trust Economic Highlights – Aug 25


United States

  • Broad equity indices recorded consistent gains through Thursday as a strong domestic data and anticipa­tion of dovish remarks by Fed Chair Yellen at the Jackson Hole symposium this morning were enough to offset some of the hawkish undertones apparent in the July FOMC minutes.
  • But, with Yellen’s remarks sounding decidedly less dovish, the equity rally ran out of steam.
  • Housing data was particularly encouraging as homebuilder confidence, housing starts, and existing home sales all rose above expectations, nearing their post-recession highs achieved last year.
  • Initial jobless claims and data on manufacturing from the Philly Fed also surprised to the upside, while CPI inflation readings remained subdued.


  • Canadian economic data this week suggest the Canadian economy is set to beat expectations in the second quarter of 2014, and for the year as a whole.
  • Nominal retail sales advanced 1.1% in June, the six consecutive monthly increase. This puts real consumer spending on track for a 5.0% annualized gain in the second quarter of the year. Robust housing activity is likely to keep retail spending healthy through the rest of the year.
  • Meanwhile, the better-than-expected U.S. housing data this week underpins our view that the Canadian export sector will continue to benefit from strong growth in the U.S. economy over the rest of 2014.
  • Still, we continue to maintain our view that the Bank of Canada will remain on hold until next year as the release of consumer price data this week showed that inflation is softening in Canada

For further information, please contact:
John Maveety Manager, Residential Mortgages – Greater Ottawa Area TD Canada Trust
T: (613) 371-1984 F: (888) 899-1984 P: (866) 767-5446