TD/ Canada Trust Economic Highlights – Oct. 7


United States

  • U.S. payroll growth accelerated to 248 thousand in September, with revisions to the previous two months adding 69 thousand to the tally, helping assuage fears that the labor market momentum is slowing.
  • Other domestic data releases were more mixed. August personal spending and income growth were robust, as were exports for the month. But, news from the manufacturing and housing sectors was less upbeat with manufacturing PMIs pulling back, while pending home sales and construction spending declined.
  • International data mostly disappointed, with global growth worries remaining as apparent as ever.
  • The jobless rate fell to 5.9% while inflation remained lukewarm at 1.5% y/y, leaving the Fed plenty of room to keep rates low. We expect QE to end this month, but rate hikes to begin in mid-2015 or later.


  • A broad based selloff in commodity prices in recent weeks has led to a 10% drop in the Bank of Canada’s commodity price index for the third quarter as a whole.
  • Common factors underpinning the slump in commodity prices include a slowdown in the Chinese economy, weak manufacturing activity in Europe and an appreciating U.S. dollar.
  • In Canada, lower commodity prices, combined with the relative strength of the U.S. dollar, have driven the loonie below 89 US cents, and the resource-based S&P/TSX down to a 4-month low.
  • Commodity prices will be subject to further bouts of downward pressure in the near-term; however, we expect them to stabilize toward the end of this year or early in 2015 as global economic activity improves modestly.

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) 767-5442