HIGHLIGHTS OF THE WEEK – Aug. 8
- It was an eventful week for U.S. markets, filled with top tier data releases, a policy announcement by the Federal Reserve, and a new record high for the S&P 500.
- Second quarter GDP, which included the comprehensive benchmark revisions dating back as far as 1929, showed that the U.S. economy expanded by 1.7% (annualized) in the second quarter of 2013 – well above market expectations for 1.0%.
- July’s non-farm payrolls rose by a disappointing 162k, coming in far below the markets expectations of 185k. The unemployment rate dropped 0.2 percentage points, landing at 7.4% – its lowest level since December 2008.
- The TSX was beset by a potash-driven plunge this past week, and if recent news leads to a restructuring of the global potash market, it could have notable impact on Canada’s producers, and the Saskatchewan economy in particular (see analysis here).
- For Canada, the second quarter appears to be shaping up largely in line with our 1.6% forecast. That said, several transitory shocks are likely to impact the third quarter data releases which start rolling in next week, and investors should remain focused on the medium-term trends for the Canadian economy.
- Perhaps the most important economic data for the second half of the year are coming from the United States. Canada needs better export demand to drive the next leg up in its economic growth, and so we will be watching closely for the crucial acceleration in economic growth south of the border.
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