TD / Canada Trust Weekly Economic Highlights – April 22


United States

  • It was a somber week in financial markets. Early in the week, news that China’s growth slowed to a worse-than-expected 7.7% rate led to a sell-off in global commodity and equity markets.
  • The price of gold plummeted early in the week, experiencing its largest two-day decline in over 30 years. As of closing on Thursday, gold prices were down 10.9% from a week-earlier. The rout extended across commodity markets with copper down 7.2% and oil down 6.1% on the week.
  • While the bearish argument is playing out in the numbers right now, the bullish argument is based on a belief that the U.S. economy is on the cusp of taking its traditional role as a driver of global economic growth.
  • This hope is premised in large part on the rebound in the housing market. On that note, housing starts beat expectations and topped the one million mark for the first time since 2008.


  • The widespread sell-off in commodity prices this week led the S&P/TSX to fall to a 5-month low.
  • The Bank of Canada left the overnight rate unchanged and downgraded its forecast for Canadian economic growth in 2013 to 1.5% (from 2.0% previously).
  • Several factors, including lower commodity prices, economic underperformance vis-a-vis the U.S., and the anticipated unwinding of quantitative easing stateside, augur for a lower Canadian dollar. We have significantly revised our forecast, with the loonie hitting a low of 90 US cents in early 2014.


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

[email protected]