TD Canada Trust provides a weekly economic highlight report that we choose to share with our clients and those who follow us. This is an easy place to stay current on the broader economic conditions in Canada and the U.S. so that you are better informed to make stronger decisions around your own real estate investments. We are always available to answer any questions or walk through your real estate investment goals for now or in the future.
- Disappointing GDP data capped a busy week. Economic growth was effectively flat in Q4 of last year, while a monthly decline in December GDP bodes poorly for Q1.
- In 2018Q4, consumer spending slowed significantly while residential investment contracted. Non-residential spending also fell sharply, though data on investment intentions suggests a better 2019 for capital spending.
- Overall, weak data and little inflationary pressures reinforce the need for the Bank of Canada to remain patient on rates.
- The U.S. economy grew a robust 2.9% in 2018, the best performance since 2015, but growth moderated at the end of the year and at the start of 2019. The government shutdown and soft consumer spending in December are expected to translate into near-1% growth this quarter.
- Extending the barrage of negative housing data, housing starts plunged by 11.2% (m/m) in December to 1.08 million (annualized).
- Manufacturing data remained soft. The U.S. ISM manufacturing index declined in February, and manufacturing contraction in Europe and Asia broadened further. Soft global activity reinforces the Fed’s patient stance.