HIGHLIGHTS OF THE WEEK – May 25
• After last week’s blockbuster retail sales report, the positive data stream continued for the U.S. economy with reports on housing, industrial production, and consumer prices all suggesting a constructive tone.
• Alongside upward revisions to previous months, the robust data indicated that first-quarter growth was not as weak as expected, and confirmed the acceleration in the second quarter remains on track.
• The positive data has not gone unnoticed by the Fed officials, with plenty of hawkish rhetoric heard this week. Alongside the also hawkish minutes from their April meeting, the Fed looks increasingly likely to go ahead with another interest rate rise in the near future – so long as data continues to cooperate and the global economy remains out of the headlines.
• Crude oil prices hit a 7-month high this week, but the loonie fell to 76 US cents thanks to a broad-based strengthening in the U.S. dollar and weakening prospects for the Canadian economy.
• Manufacturing, retail and wholesale sales were all soft in March, providing a weak handoff for economic growth in the second quarter.
• Headline inflation accelerated to 1.7% y/y in April, while the core measure came close to the Bank of Canada’s target at 2.2% y/y.
• Existing home sales data were the bright spot this week, reaching a record level for the month of April.
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