Real estate report: October 30th, 2020  

fsim.ca/docs/Oct30rereportv1.pdf

Mark Sibthorpe

The big buzz in real estate recently is Mark Carney being scooped up by Brookfield. This means more juice for riskier borrowers. Brookfield, a huge player in real estate, both residential and commercial, recently bought its remaining shares from Sagen (Genworth MI Canada), which values the company at $3.8 bn.

VersaBank’s New High-Security VPN Proving Especially Valuable During COVID-19 Pandemic  

fsim.ca/docs/TailscaleReleaseMarch30FINAL.pdf

Press Release

2014 FSIM when Bernanke visited Montreal  

fsim.ca/docs/MockBernanke.pdf

Mark Sibthorpe

Considering Bernanke is hated by the Republicans and hated even more by the Democrats, and is currently under scrutiny for saving AIG but not Lehman, (in hindsight) with respect to issues over solvency vs liquidity, the Montreal lovefest attended by 1,100 people yesterday must have been a welcome respite. Click the link to read the entire 2014 report.

Eisman's big Canadian bank short  

fsim.ca/docs/eisman2.pdf

Mark Sibthorpe

I have been reporting on Steve Eisman's short position for quite some time.  As the analyst reaction to Eisman shows (link below), Eisman has taken a lot of heat for shorting Canadian banks. Instead of capitulating, in September 2019 he publicly disclosed the fact that he added Canadian Tire to his position, He explains the rationale for this in a BNN interview late 2019. Essentially, his big concern with respect to banks was non-performing loans in Alberta. He feels Canadian bank CEOs are not prepared for a credit cycle. He specifically referenced ATB (a private bank) in discussing his concerns. Looking at the numbers today, my guess is that he has made off like a bandit.

VersaBank Beta-Testing Its New, High Volume Mortgage Finance App   

fsim.ca/docs/VBCortelMortFinanceAppFeb62020.pdf

Press Release

VersaBank announces it is initiating beta-testing on its newly developed high-volume mortgage software app with the Cortel Group, one of Canada’s largest home and condominium builders. The app, named “Direct Connect”, was designed to facilitate and significantly reduce the lengthy finance approval process typically experienced by home buyers when visiting home and condo pre-construction sales offices.

How and why you need to defend your brand against disruptors  

Mark Sibthorpe

Technology, and being open to opportunities, has preempted transformation in banking. At the top of change are Mint, PayPal and ApplePay; three examples of transformative solutions that are now ubiquitous. On the horizon: Uber and Google, both having recently announced partner based banking services. Further down in the plumbing is Duca Impact Labs, Versabank, and Revolut. This report shows how cost conscious FIs can, not only stay relevant in the face of adversity, but punch well above their weight. All thanks to creative thinking and the ongoing commoditization of technology.

Kick the can(nomics)  

fsim.ca/docs/Kick.pdf

Mark Sibthorpe

Canada has used consumer debt to provide life support to the economy. This strategy which basically pushed the day of reckoning to the next government was old back in 2014, and now is well past its sell-by-date. Recognizing this, and desperate to keep the economy out of a recession, Trudeau is spending more money now than any government in Canadian history. This report disusses a possible alternative.

ScoreCard Bill Morneau, Canada's Minister of Finance  

fsim.ca/docs/ScoreCardMorneau.pdf

Mark Sibthorpe

This report is a scorecard I designed in order to rank the performance of the current Minister of Finance, Bill Morneau. I do regular rankings because, otherwise, I cannot measure the performance in a meaningful way. The scoring is based on a variety of metrics as detailed on the ‘score-table’ on page 3. Examples of the criteria and weighting include:

Observations and overview of 2018 NB flood support from government and insurance companies.  

fsim.ca/docs/Observations and overview of 2018 NB flood support from government and insurance companies..pdf

Mark Sibthorpe

Flood aftermath is linked to post traumatic stress. Here are some findings from a study conducted by Queensland University following a flood:

"The findings showed that aftermath stress contributed to poor mental health outcomes over and above the flood itself, prior mental health issues and demographic factors," Ms Dixon said.

"Aftermath stress was the strongest predictor of post-traumatic stress symptoms with 75 per cent of people saying the most difficult aspect was the aftermath and dealing with insurance companies," she said.

With this in mind, I felt it was important to understand how New Brunswick flood victims were treated.

Update Argentina: a sign of the times  

fsim.ca/docs/Update Argentina_ a sign of the times.pdf

Mark Sibthorpe

Argentina is in the news daily because the situation is dire, and may be an indication of further contagion. The most dramatic story that speaks of the a leading cause of its troubles was the recent arrest of the public works secretary, Jose Lopez. June 15th he was caught hiding millions in cash in a monastery. No this is not a plot for a comedy.

Summary of Canada's flood news, 2017 to present  

fsim.ca/docs/Summary-of-flood-news-2017-present.pdf

Mark Sibthorpe

This report covers flood news in Canada from 2017 to present and highlights the relevent issues for home-owners and the insurance industry.

Banking on Pot  

fsim.ca/docs/c10191_banking-on-pot.pdf

SBS

As states across the US legalize marijuana for both medicinal and recreational purposes, it has fueled a growing industry of marijuana related businesses (MRBs).

Canadian banking industry overview  

Mark Sibthorpe

The industry overview is divided into 5 parts:

Introduction
Small banks
Small medium sized banks
Medium sized banks
Medium large banks

2014 Mobile payments the Apple pay way  

fsim.ca/docs/Mobile_Payments_Apple_Pay_2014.pdf

Mark Sibthorpe

With Walmart Pay about to userp Apple Pay, I thought I would share my 2014 book on mobile payments and loyalty. The guilde was written for Merchants that want to understand loyalty, credit, mobile payments and Apple Pay, but anyone involved with credit and loyalty might find it useful.
The book is a prelude to Walmart leaving MCX, and chronicles the evolution that led to Walmart Pay. There is an extensive case study of Walmart that looks into its efforts to become an ILC and to avoid paying credit card transaction fees ('merchant discount').
It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and industry facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives. 

Death to bitcoin, long live the blockchain   (See full report)

Mark Sibthorpe

Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.

TD bank industry conduct  

fsim.ca/docs/tdind2.pdf

Mark Sibthorpe

TD’s share price recently collapsed by $7 bn in one day due to CBC’s allegations of aggressive selling tactics. A huge fall from a bank that was trading at a premium as recently as January. This was even before the most recent allegation of TD attempting to avoid paying taxes on advertising.
This report chronicles the events leading up to the collapse, shows TD's performance, analyses other related issues.

Book review: Back from the Brink  

fsim.ca/docs/backbrink.pdf

Mark Sibthorpe

This is a book review of the book Back from the Brink by Paul Halpern, Caroline Cakebread, Christopher C. Nicholls and Poonam Puri.

Footnote 151  

fsim.ca/docs/footnote151.pdf

Mark Sibthorpe

Footnote 151 implies an important regulatory change related to derivative contracts. It means that US Banks will not be required to hold as much capital against commodities. If you want to understand the implications of this regulatory change in more detail, see the enclosed related article detailing the changes. For contextual purposes, I have also included two Rolling Stones Magazines reports from 2010 and 2014 that chronicle the role large US banks have played in manipulating commodities. You might question the credibility of these sources, but rest assured, these reports are based on United States Senate hearings which outline the issues in a 396 page report related to the implied risks. 

Save the Canadian economy now  

fsim.ca/docs/helecopter-money.pdf

Mark Sibthorpe

Consumer debt spending appears to have insulated Canada from the worst of the credit crisis, but now the alarming magnitude of consumer debt ($1.92-trillion) could exacerbate a day of reckoning.
This report assesses the issues at hand and recommends the solution to get Canada's economy on track.

Reasons financial service companies should consider gamification  

fsim.ca/docs/GamingEventProposal-printsample--en-final.pdf

Mark Sibthorpe

Gamification of business processes resulted on Mint.com growing to 10 million users within 4 years. This report explains how.

National Bank Special Report  

fsim.ca/docs/NatBSpec.pdf

Mark Sibthorpe

According to Bloomberg, National Bank of Canada will take a C$64 million ($48 million) restructuring charge in the fourth quarter and said its investment in Maple Financial Group Inc., which is being probed by German regulators, may be at risk of a “substantial loss.”

Will Canadian banks charge companies for deposits?  

fsim.ca/docs/depgrowthimpact2.pdf

Mark Sibthorpe

In light of today’s possible rate cut, this report discusses how a bank rate cut and capital ratio pressure could precipitate negative corporate deposit interest rates in Canada.

Canadian Tire's (CTC) - Canadian Tire Financial Services (CTFS) Scotia deal overview and risk assess  

fsim.ca/docs/ctfsfinal.pdf

Mark Sibthorpe

Review of the Canadian Tire Financial Services deal with Scotiabank, risks, opportunity and benefits.

Finance minisiter scorecard August 26, 2015  

fsim.ca/docs/Scorejo-August-2015.pdf

Mark Sibthorpe

This report looks at Joe Oliver, minister of finance’s progress to date, and assigns a grade to his government’s performance to date.

Xtreme Branch  

fsim.ca/docs/xbranch.pdf

Mark Sibthorpe

Branches are evolving to meet the digital age. This documents tracks the evolution with real-world examples.

Canadian Nudge  

fsim.ca/docs/nudge.pdf

Mark Sibthorpe

CWB cause for concern  

fsim.ca/docs/cwbupdate.pdf

Mark Sibthorpe

BNTV Overview  

fsim.ca/docs/overviewpdf.pdf

BNTV

BankNews.TV Publishing Corp services overview document:

• Analytics
• Financial services industry monitor (FSIM) industry briefings and developments reports
• Research

Challenger banks not a threat to big banks  

fsim.ca/docs/challenger.pdf

Mark Sibthorpe

This report looks at Canadian challenger banks (apart from merchant led banks) and explains why they have not threatened larger institutions. It also looks at ways in which these upstarts have achieved success.

Gamification of financial data project  

fsim.ca/docs/GamingEventProposal-printsample--en-final_original.pdf

Mark Sibthorpe

This document contains details on how BankNews.TV is helping kids learn programming via gamification of financial data.

The impact a rate rise will have for Canadian banks  

fsim.ca/docs/irr-f.pdf

Mark Sibthorpe

Canadian banks have made money throughout the credit crisis, but this trend may be about to reverse. The rational supporting this prediction is that revenue has grown despite a declining net interest margin (NIM). It has grown in spite of this fact because Canadian debt (loan lease volume) has risen significantly, as shown in chart 2.

FIFA: the new goldenballs  

fsim.ca/docs/goldenballs.pdf

Mark Sibthorpe

Yesterday, the Attorney General of Switzerland (OAG) opened criminal proceedings related to the FIFA scandal. This report outlines some of the events related to the criminal investigation, with a particular focus on banking.

Scorecard Minister of Finance: JIm Flaherty  

fsim.ca/docs/Scorecard Min Fin Flaherty April 8 2014.pdf

Mark Sibthorpe

March 18, Finance Minister Jim Flaherty resigned from cabinet after having endured a difficult year due to health issues. This report looks at his legacy and attempts to grade his government’s performance to date.

Sample RFP for a Loyalty Program  

fsim.ca/docs/sample RFP for a loyalty program.pdf

Mark Sibthorpe

Merchants extend financial services  

fsim.ca/docs/merchantfs.pdf

Mark Sibthorpe

Merchant led financial services are growing in importance once again. This is exemplified in the ongoing UK rivalry between ASDA, Sainsbury and Tesco. Together these merchant/financial service companies provide the backstop for three different approaches for merchants looking to extend their financial services.

Hot Money: real-estate  

fsim.ca/docs/hotmoney.pdf

Mark Sibthorpe

Currency Cheat Sheet: a guide for the rest of us  

fsim.ca/docs/currencycheatsheet.pdf

Mark Sibthorpe

Riches to Rags? Summary of possible risks for Genworth MI CANADA, INC.  

fsim.ca/docs/gq4risk.pdf

Mark Sibthorpe

Genworth had its Q4 2014 earnings call. Genworth own about 30% of the mortgage default insurance in Canada. Not surprisingly, the earnings call became focussed on Alberta; and for good reason, with 20% of its outstanding insured mortgage balance in Alberta, sensitivity to the oil shock and how Genworth plan to manage related risks were discussed in detail.

Canadian Western Bank Competitive Forecast  

fsim.ca/docs/cwbf.pdf

Mark Sibthorpe

Based on historical financial data (see detailed charts pages 5-8), the oil based recession in Alberta, and comparison against two of its peers, this document outlines my observation with respect to CWB’s future performances.

Liquid Canada: the tipping point  

fsim.ca/docs/Liquid.pdf

Mark Sibthorpe

This report examines liquidity issues in the Canadian financial service industry.

Bank Fees  

fsim.ca/docs/Bank fees.pdf

Mark Sibthorpe

Recently the CBC and The Globe and Mail both reported on what has been referred to as a consumer “bank fee outcry”. CBC compares banks to cable and phone companies, standing accused of trying to gouge customers with service fees. The backlash appears to have originated in conjunction with the NDP and the Consumers Council of Canada which argues that there is anxiety ‘among consumers about banking fees’.

Cheap Oil Report  

fsim.ca/docs/co2.pdf

Canada's Economy, a strategic solution  

fsim.ca/docs/ces.pdf

Complete loyalty RFP  

fsim.ca/docs/booksample.pdf

Mobile Payments Blueprint: guide to credit and loyalty transformation for merchants  

fsim.ca/docs/booksample.pdf

Report on merchants extending financial services  

fsim.ca/docs/

Guide to system selection  

fsim.ca/docs/gssnow.pdf

Read sample report: Guide to system selection. This sample would normally cost $99 but is available free as a sample. Click here view sample report.

RBC NAMES SITTING BCE CHIEF TO BOARD OF DIRECTORS, EXPANDING EXECUTIVE WEB TYING CANADA’S BANKS AND TELECOMS TOGETHER

G&M - James Bradshaw (2022-08-14)

BCE Inc. chief executive officer Mirko Bibic is joining the board of directors at Royal Bank of Canada, expanding the powerful web of bankers and executives who straddle two of Canada’s largest industries.

CANADIAN HOME PRICES COULD DROP BY 25 PER CENT BY END OF NEXT YEAR, REPORT SAYS

G&M (2022-08-12)

Canada’s average home price could drop by as much as 25 per cent from peak values in February by the end of next year, with the Maritimes and most of Ontario shouldering greater declines owing to the sharp jump in borrowing costs, says a new private-sector forecast.

BROOKFIELD PROFIT FALLS 39 PER CENT AS RATES RISE; CARNEY TO CHAIR ASSET-MANAGER SPINOFF

G&M - David Milstead (2022-08-12)

On Thursday, Brookfield also revealed a few more details of the planned spinoff of its asset-management business, including the appointment of former Bank of Canada governor Mark Carney as chair of the new company, and the spinoff’s new name: Brookfield Asset Management Ltd.

CANADIAN TIRE PROFIT FALLS 30 PER CENT EVEN AS SALES GAIN

G&M - SUSAN KRASHINSKY ROBERTSON (2022-08-12)

Canadian Tire Corp. Ltd. 

WHY AREN'T CANADIAN BANKS LOWERING FIXED MORTGAGE RATES GIVEN THAT BOND YIELDS ARE FALLING?

G&M - Robert Mclister (2022-08-12)

With rates rocketing last quarter, banks’ funding and hedging costs soared even more, squeezing their profit margins. These “spreads,” as banks call them, only started improving materially in the past couple of months.

CPPIB BREAKS WINNING STREAK WITH $23-BILLION LOSS AMID 'MARKET TURBULENCE'

Yahoo Finance - Barbara Shecter (2022-08-12)

On Thursday, CPPIB reported a 4.2 per cent loss, equivalent to $23 billion, for the three months ending June 30. Net assets fell to $523 billion from $539 billion, and included an influx of $7 billion from CPP contributions.

GOLD SET FOR FOURTH WEEKLY GAIN ON SIGNS FED TO EASE RATE HIKES

Yahoo Finance - Ranjeetha Pakiam (2022-08-12)

The precious metal has now rebounded around 6% from a low in mid-July on a combination of fears of a global recession and heightened US-China tensions over Taiwan. It’s also been aided by declines in the dollar in recent weeks.

JAPAN'S YEN BEARS BRUNT OF MARKET RETHINK ON FED

Yahoo Finance - Rae Wee and Vidya Ranganathan (2022-08-12)

The Japanese yen fell the most against a resurgent U.S. dollar on Friday, as a two-day rally in equities conceded to market expectations that the Fed will have to do a lot more to contain inflation.

BROOKFIELD ELEVATES MARK CARNEY AS IT SHUFFLES SENIOR RANKS IN ASSET MANAGEMENT SPINOFF

FP - Layan Odeh (2022-08-12)

Brookfield Asset Management Inc. is shuffling its senior ranks as its prepares to reorganize its core investment business, mapping out a potential long-range succession plan for chief executive officer Bruce Flatt.

RISING MORTGAGE RATES DRIVING ONTARIO HOMEOWNERS TO MOVE IN SEARCH OF AFFORDABILITY

FP - Victoria Wells (2022-08-12)

High home prices, exacerbated by rising mortgage rates, are forcing some homeowners in Ontario to sell and find more affordable digs, new research from a real estate industry website suggests.

CANADA'S HOUSING MARKET HEADED FOR 'HISTORIC CORRECTION,' SAYS RBC

FP - Pamela Heaven (2022-08-12)

Canada’s largest bank has downgraded its outlook for the housing market and now forecasts a “historic correction,” worse than any national decline seen in this country in the past 40 years.

GROCERY RETAILER METRO PROFIT RISES 9% AS FOOD AND PHARMACY SALES GROW

FP (2022-08-12)

The Montreal-based grocery and drug store retailer says the profit amounted to $1.14 per diluted share for the period ended July 2, up from $1.03 cents per diluted share a year earlier.

SANCTION ALL RUSSIAN BANKS, UKRAINE’S AMBASSADOR TO THE US URGES

Bloomberg - Eric Martin (2022-08-12)

Ukraine is calling on President Joe Biden’s administration to sanction all Russian private banks to help end President Vladimir Putin’s ability to wage war, according to Kyiv’s envoy to Washington.

THE GREAT RESIGNATION HAS ARRIVED IN CANADA

G&M - DAVID PARKINSON (2022-08-11)

It took a while for a version of the Great Resignation to take hold in Canada, but now it’s here. It has taken the form of a retirement wave – and its arrival further clouds the outlook for an already murky economy.

CANADA’S SECURITIES ENFORCEMENT TAILS OFF, AND THE FUTURE LOOKS NO BRIGHTER

G&M - David Milstead (2022-08-11)

Enforcement activity by Canada’s provincial stock-market cops dropped sharply during the first two years of the pandemic. Now, as investments look sicker, will regulatory activity get more robust? There are reasons to fear it will not.

U.S. INFLATION RATE SLIPS FROM 40-YEAR PEAK BUT REMAINS HIGH AT 8.5%

G&M - Christopher Rugaber (2022-08-11)

Falling gas prices gave Americans a slight break from the pain of high inflation last month, though the surge in overall prices slowed only modestly from the four-decade high it reached in June.

BANK OF ENGLAND SAYS WEAKENING REGULATORS WOULD UNDERMINE MARKET REFORMS

Yahoo Finance (2022-08-11)

Weakening the independence of regulators would undermine reforms to bolster Britain's finance industry, the head of the Bank of England said on Thursday, in a rebuff to proposals from the leading candidate to be the country's next prime minister.

MEXICO, PERU, ARGENTINA SET FOR NEW RATE HIKES: DECISION GUIDE

Yahoo Finance - Max de Haldevang (2022-08-11)

Mexico and Peru’s central banks are expected Thursday to hike their key interest rates to the highest point in more than a decade, as they continue their record tightening cycles to try to wrestle persistent inflation back under control.

ROOF IS ABOUT TO CAVE IN ON THE CANADIAN ECONOMY

FP - David Rosenberg (2022-08-11)

While these figures are concerning, to say the least, the carnage could be much more severe than even we anticipate, given that household balance sheets remain in poor shape and that the economy’s exposure to the real estate market is near all-time highs, with real estate as a share of disposable income at a record 563 per cent and the share of new mortgages with variable rates at 55 per cent.

ODDS OF BANK OF CANADA HIKING 75 BASIS POINTS IN SEPTEMBER JUST WENT DOWN

FP - Eerik Hertzberg (2022-08-11)

Overnight swap markets suggest about a 45 per cent chance that officials led by Governor Tiff Macklem will increase borrowing costs by three quarters of a percentage point at their Sept. 7 decision. A move of that magnitude would bring the policy rate to 3.25 per cent, the highest since April 2008.

'SOFT LANDING IS WISHFUL THINKING AT THIS STAGE:' FORMER BANK OF CANADA ECONOMIST

FP - Gabriel Friedman (2022-08-11)

This week on Down to Business, Jean-Paul Lam, a professor in the University of Waterloo’s Dept of Economics and a former assistant chief economist at the Bank of Canada, talks about interest rates and inflation.

MANULIFE’S CANADIAN OPERATIONS CUSHION BLOW FROM COVID-HIT ASIA

Bloomberg - Kevin Orland (2022-08-11)

Manulife Financial Corp.’s Canadian business boosted profit last quarter on the back of rising sales and lower-than-expected benefit use, cushioning the toll that continued Covid restrictions are taking on its Asian operations.   

CANADIAN REAL ESTATE AFFORDABILITY HITS WORST LEVEL SINCE THE 90S: BANK OF CANADA

Better Dwelling (2022-08-11)

The BoC HAI ripped to the highest level in a generation, and the highest share in 3 decades. The HAI shows a household needs 42.8% of their disposable income to carry a home in Q1 2022. It’s an increase of more than 3 points from the previous quarter and 8.1 points from last year. The HAI hasn’t been this high since Q3 1991, which was the previous peak of the real estate cycle (i.e. the bubble peak).

AGGRIEVED INVESTOR MUST PAY BACK LOAN, COURT FINDS

Investment Executive - James Langton (2022-08-11)

In her defence, and in a counterclaim seeking $60,000 from the bank, Letrado argued that she assumed Kumar worked for B2B and that the bank should have known Kumar was borrowing money on her behalf and investigated him. She also argued that it breached its fiduciary duty or duty of care to her.

BANKERS TURNED BILLIONAIRES FOR AN INSTANT, THEN CAME 89% CRASH

Bloomberg - Venus Feng (2022-08-10)

Two founders of a little-known Hong Kong investment bank briefly became billionaires in recent days following a baffling stock surge, only to see their paper fortunes quickly tumble when the shares plunged. 

CANADIAN FINANCIER NED GOODMAN FOUNDED AN ARRAY OF CANADIAN MONEY MANAGERS AND MINING COMPANIES

G&M - ANDREW WILLIS AND NIALL MCGEE (2022-08-10)

Financier Ned Goodman, a major player on Bay Street who for five decades founded money management firms and backed successful mining companies, passed away on Sunday at age 85.

Mr. Goodman, a native of Montreal, provided the capital and leadership that transformed small resource projects into major companies such as Kinross Gold Corp. 

GREATER TORONTO DETACHED REAL ESTATE PRICES DROPPED AS MUCH AS $178K LAST MONTH

Better Dwelling (2022-08-10)

Greater Toronto detached real estate prices made a sharp drop last month. The benchmark across the region fell to $1,455,000 in July, down 4.5% (-$68,600) in just one month. Demand has been softening as rates increase and exuberance dissipates. The segment is now in a buyer’s market, where prices are expected to fall even further. 

MAJOR ECONOMIES FACING SLOWER GROWTH: OECD

Investment Executive - James Langton (2022-08-10)

“Dragged down by historically high inflation, low consumer confidence and declining share price indices, the CLIs remain below trend and continue to anticipate a loss of growth momentum in most large OECD economies,” the Paris-based group said in a release.

CARLYLE BOSS QUIT AFTER FAILED REQUEST FOR $300MN PAY PACKAGE

FT - Kaye Wiggins, Anoine Gara (2022-08-10)

Carlyle Group’s ousted chief executive Kewsong Lee asked for a pay package worth up to $300mn over five years and resigned from the US private equity group after its co-founders refused to even discuss the deal, multiple people with knowledge of the matter said. Lee crafted the deal during negotiations with his consultants and Carlyle this spring ahead of planned talks with the board over a new five-year contract. The share-based pay package was tied to the performance of the private equity group’s stock. But Carlyle’s billionaire co-founders Bill Conway, David Rubenstein and Daniel D’Aniello, who sit on its board, would not engage in talks on the proposal and did not respond to Lee’s detailed submission, the people said.

WHY CRITICISM OF THE BANK OF ENGLAND IS LARGELY MISPLACED

FT - Bruna Skarica (2022-08-10)

With inflation higher than it has been in decades, there is no shortage of critics of the Bank of England. Still, the bulk of the blame seems largely unfounded.

THE UK GOVERNMENT’S VENTURE FUND HAS A PROBLEM — WITH FAILURE AND SUCCESS

FT - Helen Thomas (2022-08-10)

It is fitting that the taxpaying public gets to hear a candid appraisal of the government’s pandemic venture capital fund by accident.

AS MORE CANADIANS CHOOSE COMMON-LAW RELATIONSHIPS, EXPERTS URGE ESTATE PLANNING

G&M - Ben Mussett (2022-08-09)

With nearly one in four Canadian couples now living in a common-law relationship, estate planning experts are urging the ever-growing number of nonmarried couples to draw up a will to ensure their life partners aren’t forgotten once they’re gone.

INSOLVENCIES EXPOSING CRACKS IN CANADA’S ECONOMY

G&M - DAVID PARKINSON (2022-08-09)

For a while there, it looked like government support programs had saved Canadians from widespread insolvencies and business failures in the COVID-19 recession. Maybe we declared that victory too soon.

POWER CORP. CEO DEFENDS INVESTMENTS IN FINANCIAL TECHNOLOGY COMPANIES AMID SECTOR DOWNTURN

G&M - Clare O'Hara (2022-08-09)

Power Corporation of Canada’s chief executive officer, Jeffrey Orr, is defending the company’s investments in financial technology startups, despite a downturn in the sector that has resulted in a dramatically lower valuation for the company’s biggest fintech bet, Wealthsimple Technologies Inc.

CRYPTO WINTER CONTINUES TO SHAVE BILLIONS FROM THE STOCK MARKET: MORNING BRIEF

Yahoo Finance (2022-08-09)

"Nvidia's gaming slowdown likely includes the chips they sell to the crypto market, which has been weak, hence the extent of the slowdown is so significant," J.P. Morgan analyst Sandeep Deshpande wrote in a note on Monday.

BANK OF ENGLAND WILL PROBABLY NEED TO RAISE RATES AGAIN, RAMSDEN SAYS

Reuters - William Schomberg, Andy Bruce (2022-08-09)

Inflation is expected to return to the BoE's 2% target - down from above 9% now and a projected peak of 13% in October - as the economy goes into a recession and borrowing costs rise.

CHINA ORDERS AUDIT OF $3 TRILLION TRUST INDUSTRY

Reuters (2022-08-09)

China's top auditor is conducting a review of the $3 trillion trust industry, Bloomberg News reported on Tuesday, citing people familiar with the matter.

CARLYLE CEO KEWSONG LEE STEPS DOWN IN ABRUPT EARLY DEPARTURE

Reuters - Chibuike Oguh, Kane Wu (2022-08-09)

The firm, which reported earnings in July without flagging potential leadership changes, said Lee had also stepped down as a board member.

ROMAN ABRAMOVICH’S LONDON EMPIRE UNRAVELS AS SANCTIONS BITE

Bloomberg - Benjamin Stupples (2022-08-09)

Roman Abramovich’s cream-colored Kensington mansion has more than a dozen bedrooms and police vans posted at each end of its tree-lined street. Nearby neighbors include British royals, steel magnate Lakshmi Mittal and Warner Music Group owner Len Blavatnik.

TD’S LATEST U.S. ACQUISITION ADDS RISK: MOODY’S

Investment Executive - James Langton (2022-08-09)

According to Moody’s, while the deal will enable TD to accelerate its U.S. growth plans, it also increases the bank’s exposure to capital markets, which are generally riskier than TD’s other business activities.

FAIRFAX PROPOSES TAKING SWISS CHALET OWNER RECIPE UNLIMITED PRIVATE IN $1.2-BILLION DEAL

G&M - SUSAN KRASHINSKY ROBERTSON (2022-08-09)

Fairfax Financial Holdings Ltd. has proposed taking Recipe Unlimited Corp. private in a deal that values the restaurant-chain owner at $1.2-billion.

'GREAT FOR LANDLORDS, HORRIBLE FOR RENTERS': HOW A RUNAWAY RENTAL MARKET HAS BECOME TORONTO'S LATEST HOUSING NIGHTMARE

FP (2022-08-09)

“(We’re) getting tired of viewing about 10 houses, liking a couple of them and then losing out on the ones you like to someone who outbid you for $300 or $400,” Kaul said, explaining that he and his friends have started to overbid listings in an attempt to secure a place they can move into by September.

BERKSHIRE HATHAWAY POSTS $43.8 BILLION LOSS AS STOCK HOLDINGS TUMBLE

G&M - Jonathan Stempel (2022-08-08)

The slide in U.S. stock prices punished Berkshire Hathaway Inc.’s bottom line in the second quarter, as the conglomerate run by billionaire Warren Buffett on Saturday reported a US$43.8-billion loss.

PAYPAL REVEALS $2 BILLION STAKE HELD BY ELLIOTT, ANNOUNCES NEW CFO

G&M (2022-08-08)

The company also announced a slew of moves including appointing Blake Jorgensen as Paypal’s new chief financial officer and a new $15 billion repurchase program. Blake, who takes over the role on Wednesday, joins PayPal from Electronic Arts.

CAN 'GREEN BANKS' BRING CLEAN ENERGY TO THE MASSES? THE U.S. IS BETTING $27B ON IT

G&M - Kanzi Stastna (2022-08-08)

"Green banks" are one way that the Biden administration intends to distribute the billions of dollars that are meant to accelerate the adoption of solar, wind, geothermal and other forms of renewable energy.

CANNABIS GIANT CANOPY GROWTH POSTS $2B QUARTERLY LOSS

CBC (2022-08-08)

Canopy Growth Corp. executives argued the company is advancing toward profitability, even as it booked a $1.72 billion non-cash writedown that contributed to a net loss of more than $2 billion during its most recent quarter.

ECONOMISTS WEIGH IN ON CANADA'S SURPRISE JOB LOSS

Yahoo Finance - Gigi Suhanic (2022-08-08)

“Canada’s labour market is not in disarray,” said National Bank economists Kyle Dahms and Alexandra Ducharme, in their jobs commentary, noting that year-to-date, the private sector has added 110,000 positions. The pair said they continue to see “resilience in the Canadian economy” making them outliers among other big bank analysts.

EUROPE BRACES FOR EXTREME HEAT AS POWER INFRASTRUCTURE WOBBLES

Yahoo Finance - Priscila Azevedo Rocha (2022-08-08)

Extreme heat has already taken its toll on the continent, with France registering the driest July on record and England the driest in almost 90 years, underscoring the impact that a warming climate is having on vital infrastructure. Water levels on the Rhine River, a vital artery for the transport of commodities and industrial goods, are so low that trade is at risk of coming to a halt on some sections of the waterway.

REMOTE WORK IS CAUSING A MASSIVE SHIFT IN SALARIES AROUND THE COUNTRY

Yahoo Finance - Jordan Parker Erb (2022-08-08)

As companies continue to fill remote roles in towns far beyond their headquarters, white-collar salaries nationwide are getting tantalizingly close to those in major tech hubs.

RUSSIA BANS WESTERN INVESTORS FROM SELLING BANKING, KEY ENERGY STAKES

Reuters (2022-08-08)

Western countries and allies, including Japan, have piled financial restrictions on Russia since it sent troops into Ukraine in late February. Moscow retaliated with obstacles for Western businesses and their allies leaving Russia, and in some cases seized their assets.

TURKISH BANKS ARE ADOPTING RUSSIAN PAYMENTS SYSTEM, ERDOGAN SAYS

Bloomberg - Tugce Ozsoy (2022-08-08)

Five Turkish banks have adopted Russia’s Mir payments system, Turkey’s President Recep Tayyip Erdogan said on his return from talks with President Vladimir Putin in the Black Sea resort of Sochi. 

JAPAN LIFE INSURERS DUMP RECORD FOREIGN DEBT IN VOLATILE JULY

Bloomberg - Chikako Mogi (2022-08-08)

Japan’s life insurers and pension funds sold record amounts of foreign bonds in July as heightened volatility in global debt markets damped appetite.

CANACCORD REPORTS FIRST QUARTER NET LOSS

Investment Executive - Daniel Calabretta (2022-08-08)

Canaccord Genuity Group Inc. posted a net loss of $3 million in the latest quarter, compared with a $73.1-million profit a year earlier, the firm said Thursday.

CLIMATE, WAR AND INFLATION JOLT REINSURERS INTO ACTION

FT - Ian Smith (2022-08-08)

Life has not been easy for reinsurers in the past few years.

US BANKS TOUT FOSSIL FUEL CREDENTIALS AFTER REPUBLICAN ESG BACKLASH

FT - Patrick Temple-West and Joshua Franklin (2022-08-08)

In recent years, Wall Street firms have tried to talk up their commitment to the environment and social justice. Now they are singing a different tune.

U.S. CUTS SOFTWOOD TARIFFS BY HALF FOR CANADIAN LUMBER AS TRADE DISPUTE LINGERS

G&M - Brent Jang (2022-08-05)

The U.S. Department of Commerce is lowering tariffs against most Canadian softwood producers by half, but the long-running trade dispute lingers as Canada plans to appeal the decision to maintain punitive duty rates.

WEALTHSIMPLE VALUATION SLASHED NEARLY IN HALF BY LARGEST SHAREHOLDER, POWER-CONTROLLED IGM

G&M - Sean Silcoff (2022-08-05)

The largest shareholder of one of Canada’s most prominent startups, Wealthsimple Technologies Inc., has slashed the valuation of its holding for the second quarter in a row, as technology companies continue to face growing pressure.

IGM Financial Inc., 

WORLD FOOD PRICES POST BIGGEST DECLINE SINCE 2008 IN JULY

Yahoo Finance - Aine Quinn (2022-08-05)

The UN index fell for a fourth month, offering some relief to consumers facing a deepening cost-of-living crisis that spans everything from energy to transport. Still, prices remain elevated, putting pressure on households while global hunger is worsening.

CHINA WELCOMES US RIVALRY IN AFRICA IF IT BROADENS BENEFITS

Yahoo Finance - Matthew Hill (2022-08-05)

China is Zambia’s biggest bilateral creditor, accounting for almost 75% of the total, and is co-chairing a committee negotiating a debt restructuring after the country became Africa’s first pandemic-era sovereign defaulter in 2020. Relations between the two sides have cooled since President Hakainde Hichilema won power a year ago, as he has forged closer links to nations including the US and the UK.

WHY OUR LOONIE IS LAGGING DURING THE OIL BOOM

FP - Stephanie Hughes (2022-08-05)

Oil outlook in Canada weak.

JAPAN'S GPIF POSTS $28 BILLION FIRST-QUARTER INVESTMENT LOSS ON MARKET TURBULENCE

Reuters - Reuters (2022-08-05)

Japan's Government Pension Investment Fund (GPIF) reported on Friday an investment loss of 3.75 trillion yen ($28.13 billion) for April-June, the second consecutive quarter of negative returns, as economic slowdown fears hit global stock markets.

ALLIANZ SHELLS OUT 140 MILLION EUROS TO SHUT U.S. FUND UNIT AFTER FRAUD

Reuters - Tom Sims (2022-08-05)

Allianz spent around 140 million euros ($143.11 million) on restructuring to wind down a U.S. funds unit at the centre of a multi-billion fraud, the German insurer disclosed on Friday, an expense that added to a worse-than-expected 23% fall in quarterly profit.

EQUIFAX MISREPRESENTED POTENTIALLY MILLIONS OF CREDIT SCORES, LAWSUIT ALLEGES

Reuters - Alessandra Rafferty (2022-08-05)

Equifax has been hit with a lawsuit accusing it of knowingly allowing a glitch in its coding system to result in inaccurate credit scores for potentially millions of consumers.

THE BANK OF EEYORE GRUMBLES THE TRUTH. WHO’S NEXT?

Bloomberg - John Aurthers (2022-08-05)

It’s hard not to think of Eeyore when reading the commentary that the Bank published Thursday, in conjunction with the announcement that it would be raising rates by 50 basis points, the biggest increase since 1995 (and the biggest ever since the BoE gained its independence under Tony Blair and Gordon Brown in 1997). This is what it had to say about future prospects:

CRYPTO COMPANIES ARE SPENDING $2.4 BILLION ON SPORTS SPONSORSHIPS

Bloomberg - Kim Bhasin (2022-08-05)

For fans of professional sports, the insistent overtures from the crypto industry have become almost impossible to miss: The names of exchanges and blockchain companies are emblazoned on team jerseys, plastered on stadiums, and beckoning from halftime TV commercials. They’re talked up by prominent players who enjoy lucrative endorsement deals.

SUN LIFE PROFITS FALL ON DENTAQUEST ACQUISITION, ‘UNFAVOURABLE’ MARKET IMPACTS

Investment Executive (2022-08-05)

The Toronto-based insurance and asset management company says the decrease was due to “unfavourable market-related impacts” as well as its June 1 acquisition of DentaQuest, the second-largest dental benefits provider in the U.S.

TORONTO AND VANCOUVER HOME SALES TUMBLED FURTHER IN JULY AS INTEREST RATES ROSE

G&M - Rachelle Younglai (2022-08-04)

Real estate markets in Toronto and Vancouver tumbled further in July, with sales and home prices declining for another month as getting mortgages becomes more difficult and buyers wait to see how low prices can go.

RECENT SURVEYS SHOW CONFIDENCE SLUMP AMONG CONSUMERS TO EARLY PANDEMIC DEPTHS

G&M - DAVID PARKINSON (2022-08-04)

It’s unclear how quickly the Bank of Canada’s sharp interest-rate increases will have their desired effect of cooling inflation. But they appear to have dampened the mood of consumers and businesses in a hurry.

VANCOUVER HOME SALES TUMBLE, CALGARY'S SLIDE AS RISING RATES AND UNCERTAINTY TAKE TOLL

Yahoo Finance - Stephanie Hughes (2022-08-04)

The number of homes exchanging hands in the Greater Vancouver Area tumbled nearly 23 per cent in July from the month before, with 1,887 units sold. Sales were down 43 per cent from last summer when the Vancouver market was in the midst of a buying frenzy, according to data from the Real Estate Board of Greater Vancouver.

U.S. BANKER BONUSES SET TO SLIDE WHILE TRADERS BENEFIT -STUDY

Yahoo Finance - Lananh Nguyen (2022-08-04)

Payouts for investment bankers who underwrite deals will probably drop 40% to 45% this year, while incentive compensation for those advising on transactions is estimated to fall 20% to 25%, according to compensation consultancy firm Johnson Associates.

GLOBAL SHARES RISE ON OPTIMISM ON ECONOMIC DATA, EARNINGS

Yahoo Finance (2022-08-04)

BRITISH LIFE INSURER PHOENIX SEEKS MORE DEALS AFTER SUN LIFE UK BUY

Yahoo Finance - Carolyn Cohn (2022-08-04)

Phoenix has bought closed life insurer Sun Life of Canada's UK unit for 248 million pounds ($301 million) in cash, it said on Thursday and its chief executive said the insurer had more than one billion pounds to spend on similar deals.

BANK OF ENGLAND ON BRINK OF BIGGEST RATE HIKE SINCE 1995

Reuters - William Schomberg (2022-08-04)

Most investors and economists predict the BoE will increase its benchmark rate by half a percentage point to 1.75%, its highest level since late 2008 at the start of the global financial crisis, when it announces its decision at 1100 GMT.

GREATER VANCOUVER REAL ESTATE PRICES JUST MADE THE SECOND BIGGEST MONTHLY DROP EVER

Better Dwelling (2022-08-04)

Greater Vancouver real estate prices made a sharp drop but are still up by a lot. The composite benchmark price of a home fell to $1,207,400 in July, down 2.4% (-$28,500). Prices are still 10.3% (+$112,400) higher than last year. Huge numbers in both directions, so let’s take a quick dive.

CREDIT UNIONS BENEFIT FROM HIGHER RATES, BUT RISKS LOOM

Investment Executive - Rudy Mezzatta (2022-08-04)

As at the end of fiscal 2021, credit union loan books consisted of 55.5% residential mortgages, representing a 14% share of the overall Canadian residential mortgage market. The remainder of the credit union book was made of business and commercial loans (31.7%), consumer loans (6.7%) and agricultural loans (6.0%).

‘PERFECT STORM’ WIPES NEARLY $400BN OFF VALUE OF LARGE US MEDIA GROUPS

FT - Anna Nicolaou (2022-08-04)

The largest US media companies have collectively shed nearly $400bn in market value this year, as recession worries, an advertising slowdown and post-pandemic audience trends ignited a “perfect storm” for Netflix and its peers.

HOME CAPITAL REPORTS SECOND QUARTER 2022 RESULTS

Home Capital (2022-08-04)

Net income of $41.3 million or $0.97 diluted earnings per share in Q2 2022, a decrease of 4.9% from $1.02 per share in Q1 2022 and a decrease of 31.7% from $1.42 per share in Q2 2021.

UK IS CARD FRAUD CAPITAL OF EUROPE

Finextra (2022-08-04)

According to the Crime Survey for England and Wales, between April 2021 and March 2022 there were 2.3 million “bank and card frauds”, comprising 51% of the total recorded frauds committed against residents during the period.

SOARING INFLATION IN UKRAINE DEEPENS ECONOMIC TOLL OF RUSSIA’S INVASION

G&M - PAUL WALDIE (2022-08-03)

The war in Ukraine has driven up prices in Canada and around the world. But spare a thought for people in Ukraine, where inflation is closing in on 30 per cent, interest rates are 25 per cent and around one-third of the work force is unemployed.

TD TO BUY COWEN FOR US$1.3-BILLION, DOUBLING DOWN ON AMBITIOUS U.S. EXPANSION PLANS

G&M - James Bradshaw (2022-08-03)

Toronto-Dominion Bank 

U.K. FINANCIAL WATCHDOG SAYS BANKS MUST REFLECT COST OF LIVING CRISIS IN PAY

G&M - Huw Jones (2022-08-03)

Britain’s financial watchdog said on Tuesday that the cost of living crisis, meeting climate targets and improving diversity should be reflected in how banks determine pay and bonuses.

INVESTMENT FIRMS ARE SNAPPING UP U.S. HOMES. IN CANADA, THE TREND IS 'IN ITS INFANCY,' SAYS REMAX BOSS

CBC - Chris Arsenault (2022-08-03)

Investment firms have become the biggest new buyers of U.S. homes — a trend that could make home ownership more difficult for average families.

VOLATILITY HITS MARKETS WITH GEOPOLITICS ADDING TO SET OF RISKS

Yahoo Finance - Cormac Mullen and Emily Graffeo (2022-08-03)

Pelosi became the highest-ranking American politician to visit Taiwan in 25 years, prompting China to announce missile tests and military drills encircling the island. 

BUOYANT Q2 AND NEW TARGETS HELP SOCGEN WEATHER RUSSIA BLOW

Reuters - Julien Ponthus (2022-08-03)

The better-than-expected result, helped by robust retail and investment banking activity, lifted SocGen's shares 4.2% in early trading, the strongest performance in the pan-European banking index (.SX7E).

LLOYD'S OF LONDON'S HISCOX TO PROVIDE INSURANCE FOR UKRAINE GRAIN CORRIDOR

Reuters - Carolyn Cohn (2022-08-03)

Hiscox (HSX.L) is committed to a planned insurance consortium providing cover for ships travelling through a safe passage from Ukraine, its chief executive said on Wednesday, as the Lloyd's of London insurer shares plunged on a first-half loss.

RBC JOINS TD IN BETTING A SOFTER ECONOMY WON’T SPUR DEFAULTS

Bloomberg - Kevin Orland (2022-08-03)

Canada’s two largest banks laid down a vote of confidence that consumers and businesses will keep making loan payments even if inflation and rate increases throw the brakes on the economy.

CREDIT-CARD REWARDS AREN'T FREE. SHOPPERS DON'T CARE.

Bloomberg - Marc Rubinstein (2022-08-03)

The US credit-card market is the oldest and largest in the world. It’s also the least regulated and most expensive. In other countries, policy makers keep card companies in check by setting price caps or by funding public sector alternatives. The result is lower prices. In the US, credit-card fees stand at between 1.3% and 2.7% of transaction value; in Europe, they are as low as 0.3%.

CANADA’S TAX AUTHORITY HAS BEEN ON A MULTI-BILLION DOLLAR REAL ESTATE CRACKDOWN

Better Dwelling (2022-08-03)

Canadian real estate owners are stuck paying a buttload in penalties after trying to avoid taxes owed. New data from the Canada Revenue Agency (CRA) shows their crackdown on real estate owners/sellers has led to billions in recouped revenue. Data provided by the agency also shows they’ve collected substantial fines adding up to hundreds of millions, after diving into real estate transactions. The program is largely focused on Greater Toronto and Vancouver, as a high volume of red flags were being set off. 

RESIDENTIAL SCHOOLS LEFT AN ECONOMIC HOLE THAT PERSISTS ACROSS GENERATIONS

G&M - DAVID PARKINSON (2022-08-02)

In a paper published last year, University of Victoria economics professor Maggie E.C. Jones measured intergenerational damage resulting from attendance at residential schools – in other words, negative outcomes for the children of the people who were shipped off to those institutions.

TIM HORTONS PROPOSES SETTLEMENT IN CLASS-ACTION SUITS OVER DATA-TRACKING APP

G&M - CP (2022-08-02)

Tim Hortons says in court documents it would also permanently delete any geolocation information it may have collected between April 1, 2019 and Sept. 30, 2020, and direct third-party service providers to do the same.

BITCOIN AND ETHER ARE ON TRACK FOR THEIR BEST MONTH SINCE 2021

Yahoo Finance - VILDANA HAJRIC (2022-08-02)

Bitcoin is up 28% in July and Ether 70%, though their rallies paused Friday. Both were little changed, with Bitcoin at about $23,950 as of 5 p.m. in New York and Ether hovering around $1,730.

GOLD HITS FOUR-WEEK HIGH AS PELOSI’S TAIWAN TRIP STIRS TENSIONS

Yahoo Finance (2022-08-02)

Spot gold rose as much as 0.5% to $1,780.53 an ounce, before trading at $1,773.35 by 10:25 a.m in London. Bloomberg Dollar Spot Index rose 0.1%. Silver and palladium declined, while platinum edged higher.

BEWARE OF CHERRY PICKERS: MIXED ECONOMIC DATA MEANS BULLS AND BEARS BOTH HAVE STRONG CASES

FP - Martin Pelletier (2022-08-02)

Overall, it wouldn’t surprise us to see an improvement in inflationary pressures in the months to come as we’re already witnessing a sizable drop in commodity prices. For example, corn, wheat and steel prices are down 30 to 40 per cent from their highs putting them at levels seen before the Russian invasion of Ukraine. At the same time, oil and gasoline prices are also falling, easing pressure on the U.S. consumer. In our opinion, commodity prices did get ahead of themselves to the upside, but perhaps they may have overreacted to the downside as well?

'CALM BEFORE THE STORM': CANADIAN BANKS EXPECTED TO START SHORING UP RESERVES AS CONSUMER CREDIT RISKS BUILD

FP - Stephanie Hughes (2022-08-02)

“Given cycle highs in household leverage and the fastest pace of interest rate increases in over twenty years, we expect provisions for credit losses (PCLs) in the upcoming cycle to match or potentially exceed PCLs during the global financial crisis (GFC),” Veritas investment analyst Nigel D’Souza wrote in a July 26 note to clients.

WOMEN’S WEALTH IS GROWING. WHEN WILL FINANCE CATCH UP?

Bloomberg - Stuart Trow (2022-08-02)

The Women’s Euro 2022 football championship has drawn record crowds, selling out huge stadiums that, until very recently, had been the preserve of men’s games. If there was any lingering doubt about the commercial viability of women’s football, Euro 2022 (which culminated on Sunday with England’s victory over Germany) has shown that, with sufficient engagement, change can happen very quickly.

BARCLAYS SHOWS HOW TO GET OUT OF A BLUNDER

Bloomberg - PAUL J. DAVIES (2022-08-02)

When you make a mistake, it’s best to come clean and fix it as quickly as you can. That’s what Barclays Plc appears to be doing with its embarrassing error selling investment products in the US for which it didn’t have permission. It’s still going to be costly, but if things turn out as the UK bank now expects, then the whole episode could ultimately reflect well on C.S. Venkatakrishnan in his first year as chief executive officer.

TO FIGHT CLIMATE CHANGE, CHANGE YOUR BANK

Bloomberg - Tanja Hester (2022-08-02)

It’s a sweltering summer of cognitive dissonance. The northern hemisphere is experiencing record-setting, even life-threatening, heat waves, droughts and fires; yet more attention has been given to rising gas prices than to measures that would prevent future summers from getting hotter, drier and more flammable. People who want to mitigate the climate crisis are desperate for actions they can take that don’t feel like drops in an increasingly empty bucket. One of the best things the average person can do for the climate: change banks. Responsible investing gets a lot of attention because there’s big money to be made convincing do-gooder investors to buy a new investment product, even though ample evidence shows that ESG and other responsible investing approaches don’t deliver on their promises to drain money from the extraction economy. What doesn’t get enough attention is responsible banking, which has far more potential to force the economy away from fossil fuels, the leading driver of carbon emissions that cause climate change — and to force that change quickly. We haven’t heard much about responsible banking because essentially none of the big banks engage in the practice, and they aren’t eager for customers to know how their money is being used. The oil and gas industry can only operate because of big investments that fund exploration and the creation of infrastructure necessary to keep the oil flowing and coal burning. That funding, which totaled $742 billion in 2021, comes from the world’s biggest banks, according to the Banking on Climate Chaos report, released by a consortium including Sierra Club and Rainforest Action Network. US banks continue to be the single worst grouping, with the top four fossil fuel funders in the world (JPMorgan Chase, Citi, Wells Fargo, and Bank of America) all headquartered in the US, joined by Morgan Stanley and Goldman Sachs in the top 14. Together, these six banks provided 29% of fossil fuel financing identified in 2021. (Royal Bank of Canada, UnionBank, Barclays and Mizuho are right behind them.) While some of the big banks have made commitments to invest in renewable energy and regenerative projects, few have actually divested from fossil fuels or lived up to the pledges they’ve touted, and many have actually increased their funding of oil and gas projects since the Paris Agreement in 2016. Customers don’t seem to have connected the dots that their own money is what’s funding these banks’ investments in fossil fuels. If you bank with one of the big banks, the money sitting in your deposit accounts is available for the banks to use however they wish, and many of them send it to the worst offenders in the climate crisis.

OVER 1 IN 10 OF CANADA’S NON-RESIDENT REAL ESTATE OWNERS HAVE MULTIPLE PROPERTIES

Better Dwelling (2022-08-02)

It might not sound like much to the average person, but it’s a huge number that can have a significant impact on price. Even one-point of excess demand can drive prices higher, as it competes with end-user. Marginal buyers, especially deep pocketed ones, can bid up prices quickly, setting comps. It doesn’t take much, as we’ve explained with money laundering. 

CANADIAN REAL ESTATE IS WORSE THAN OFFICIAL DATA SHOWS, BMO REVISES FORECAST LOWER

Better Dwelling (2022-08-02)

Canadian real estate markets have seen a surge of listings being pulled and re-listed. An agent might have any number of reasons for delisting and relisting, but it does impact the stats. Homes that are canceled and relisted at a lower price don’t show a price cut or accurate days on market (DOM). It’s apparently a big issue in the Greater Toronto Area (GTA), warns BMO. 

SUSTAINABLE FUND PERFORMANCE SUFFERS AMID HIGH ENERGY PRICES

Investment Executive - Mark Burgess (2022-08-02)

Roughly the same proportion of sustainable allocation funds (78%) underperformed their peer group, and the same was true for about half of sustainable fixed income funds (53%).

CANADIAN ECONOMY AVOIDS CONTRACTION IN MAY, ECONOMISTS EXPECT CONTINUED SLOWDOWN

Investment Executive (2022-08-02)

“We’re expecting growth to slow, but part of the reason for that is because the economy right now is incredibly strong,” Janzen said, noting that the economic recovery from the pandemic was much faster than expected.

RBC NAMES SITTING BCE CHIEF TO BOARD OF DIRECTORS, EXPANDING EXECUTIVE WEB TYING CANADA’S BANKS AND TELECOMS TOGETHER

G&M - James Bradshaw (2022-08-14)

BCE Inc. chief executive officer Mirko Bibic is joining the board of directors at Royal Bank of Canada, expanding the powerful web of bankers and executives who straddle two of Canada’s largest industries.

CANADIAN HOME PRICES COULD DROP BY 25 PER CENT BY END OF NEXT YEAR, REPORT SAYS

G&M (2022-08-12)

Canada’s average home price could drop by as much as 25 per cent from peak values in February by the end of next year, with the Maritimes and most of Ontario shouldering greater declines owing to the sharp jump in borrowing costs, says a new private-sector forecast.

BROOKFIELD PROFIT FALLS 39 PER CENT AS RATES RISE; CARNEY TO CHAIR ASSET-MANAGER SPINOFF

G&M - David Milstead (2022-08-12)

On Thursday, Brookfield also revealed a few more details of the planned spinoff of its asset-management business, including the appointment of former Bank of Canada governor Mark Carney as chair of the new company, and the spinoff’s new name: Brookfield Asset Management Ltd.

CANADIAN TIRE PROFIT FALLS 30 PER CENT EVEN AS SALES GAIN

G&M - SUSAN KRASHINSKY ROBERTSON (2022-08-12)

Canadian Tire Corp. Ltd. 

CANADIAN HOME PRICES COULD DROP BY 25 PER CENT BY END OF NEXT YEAR, REPORT SAYS

G&M (2022-08-12)

Canada’s average home price could drop by as much as 25 per cent from peak values in February by the end of next year, with the Maritimes and most of Ontario shouldering greater declines owing to the sharp jump in borrowing costs, says a new private-sector forecast.

JAPAN'S YEN BEARS BRUNT OF MARKET RETHINK ON FED

Yahoo Finance - Rae Wee and Vidya Ranganathan (2022-08-12)

The Japanese yen fell the most against a resurgent U.S. dollar on Friday, as a two-day rally in equities conceded to market expectations that the Fed will have to do a lot more to contain inflation.

RISING MORTGAGE RATES DRIVING ONTARIO HOMEOWNERS TO MOVE IN SEARCH OF AFFORDABILITY

FP - Victoria Wells (2022-08-12)

High home prices, exacerbated by rising mortgage rates, are forcing some homeowners in Ontario to sell and find more affordable digs, new research from a real estate industry website suggests.

CANADA'S HOUSING MARKET HEADED FOR 'HISTORIC CORRECTION,' SAYS RBC

FP - Pamela Heaven (2022-08-12)

Canada’s largest bank has downgraded its outlook for the housing market and now forecasts a “historic correction,” worse than any national decline seen in this country in the past 40 years.

BANK OF ENGLAND SAYS WEAKENING REGULATORS WOULD UNDERMINE MARKET REFORMS

Yahoo Finance (2022-08-11)

Weakening the independence of regulators would undermine reforms to bolster Britain's finance industry, the head of the Bank of England said on Thursday, in a rebuff to proposals from the leading candidate to be the country's next prime minister.

MEXICO, PERU, ARGENTINA SET FOR NEW RATE HIKES: DECISION GUIDE

Yahoo Finance - Max de Haldevang (2022-08-11)

Mexico and Peru’s central banks are expected Thursday to hike their key interest rates to the highest point in more than a decade, as they continue their record tightening cycles to try to wrestle persistent inflation back under control.

ODDS OF BANK OF CANADA HIKING 75 BASIS POINTS IN SEPTEMBER JUST WENT DOWN

FP - Eerik Hertzberg (2022-08-11)

Overnight swap markets suggest about a 45 per cent chance that officials led by Governor Tiff Macklem will increase borrowing costs by three quarters of a percentage point at their Sept. 7 decision. A move of that magnitude would bring the policy rate to 3.25 per cent, the highest since April 2008.

CANADIAN REAL ESTATE AFFORDABILITY HITS WORST LEVEL SINCE THE 90S: BANK OF CANADA

Better Dwelling (2022-08-11)

The BoC HAI ripped to the highest level in a generation, and the highest share in 3 decades. The HAI shows a household needs 42.8% of their disposable income to carry a home in Q1 2022. It’s an increase of more than 3 points from the previous quarter and 8.1 points from last year. The HAI hasn’t been this high since Q3 1991, which was the previous peak of the real estate cycle (i.e. the bubble peak).

GREATER TORONTO DETACHED REAL ESTATE PRICES DROPPED AS MUCH AS $178K LAST MONTH

Better Dwelling (2022-08-10)

Greater Toronto detached real estate prices made a sharp drop last month. The benchmark across the region fell to $1,455,000 in July, down 4.5% (-$68,600) in just one month. Demand has been softening as rates increase and exuberance dissipates. The segment is now in a buyer’s market, where prices are expected to fall even further. 

WHY CRITICISM OF THE BANK OF ENGLAND IS LARGELY MISPLACED

FT - Bruna Skarica (2022-08-10)

With inflation higher than it has been in decades, there is no shortage of critics of the Bank of England. Still, the bulk of the blame seems largely unfounded.

U.S. CUTS SOFTWOOD TARIFFS BY HALF FOR CANADIAN LUMBER AS TRADE DISPUTE LINGERS

G&M - Brent Jang (2022-08-05)

The U.S. Department of Commerce is lowering tariffs against most Canadian softwood producers by half, but the long-running trade dispute lingers as Canada plans to appeal the decision to maintain punitive duty rates.

JAPAN'S GPIF POSTS $28 BILLION FIRST-QUARTER INVESTMENT LOSS ON MARKET TURBULENCE

Reuters - Reuters (2022-08-05)

Japan's Government Pension Investment Fund (GPIF) reported on Friday an investment loss of 3.75 trillion yen ($28.13 billion) for April-June, the second consecutive quarter of negative returns, as economic slowdown fears hit global stock markets.

THE BANK OF EEYORE GRUMBLES THE TRUTH. WHO’S NEXT?

Bloomberg - John Aurthers (2022-08-05)

It’s hard not to think of Eeyore when reading the commentary that the Bank published Thursday, in conjunction with the announcement that it would be raising rates by 50 basis points, the biggest increase since 1995 (and the biggest ever since the BoE gained its independence under Tony Blair and Gordon Brown in 1997). This is what it had to say about future prospects:

TORONTO AND VANCOUVER HOME SALES TUMBLED FURTHER IN JULY AS INTEREST RATES ROSE

G&M - Rachelle Younglai (2022-08-04)

Real estate markets in Toronto and Vancouver tumbled further in July, with sales and home prices declining for another month as getting mortgages becomes more difficult and buyers wait to see how low prices can go.

VANCOUVER HOME SALES TUMBLE, CALGARY'S SLIDE AS RISING RATES AND UNCERTAINTY TAKE TOLL

Yahoo Finance - Stephanie Hughes (2022-08-04)

The number of homes exchanging hands in the Greater Vancouver Area tumbled nearly 23 per cent in July from the month before, with 1,887 units sold. Sales were down 43 per cent from last summer when the Vancouver market was in the midst of a buying frenzy, according to data from the Real Estate Board of Greater Vancouver.

BANK OF ENGLAND ON BRINK OF BIGGEST RATE HIKE SINCE 1995

Reuters - William Schomberg (2022-08-04)

Most investors and economists predict the BoE will increase its benchmark rate by half a percentage point to 1.75%, its highest level since late 2008 at the start of the global financial crisis, when it announces its decision at 1100 GMT.

GREATER VANCOUVER REAL ESTATE PRICES JUST MADE THE SECOND BIGGEST MONTHLY DROP EVER

Better Dwelling (2022-08-04)

Greater Vancouver real estate prices made a sharp drop but are still up by a lot. The composite benchmark price of a home fell to $1,207,400 in July, down 2.4% (-$28,500). Prices are still 10.3% (+$112,400) higher than last year. Huge numbers in both directions, so let’s take a quick dive.

INVESTMENT FIRMS ARE SNAPPING UP U.S. HOMES. IN CANADA, THE TREND IS 'IN ITS INFANCY,' SAYS REMAX BOSS

CBC - Chris Arsenault (2022-08-03)

Investment firms have become the biggest new buyers of U.S. homes — a trend that could make home ownership more difficult for average families.

CANADA’S TAX AUTHORITY HAS BEEN ON A MULTI-BILLION DOLLAR REAL ESTATE CRACKDOWN

Better Dwelling (2022-08-03)

Canadian real estate owners are stuck paying a buttload in penalties after trying to avoid taxes owed. New data from the Canada Revenue Agency (CRA) shows their crackdown on real estate owners/sellers has led to billions in recouped revenue. Data provided by the agency also shows they’ve collected substantial fines adding up to hundreds of millions, after diving into real estate transactions. The program is largely focused on Greater Toronto and Vancouver, as a high volume of red flags were being set off. 

OVER 1 IN 10 OF CANADA’S NON-RESIDENT REAL ESTATE OWNERS HAVE MULTIPLE PROPERTIES

Better Dwelling (2022-08-02)

It might not sound like much to the average person, but it’s a huge number that can have a significant impact on price. Even one-point of excess demand can drive prices higher, as it competes with end-user. Marginal buyers, especially deep pocketed ones, can bid up prices quickly, setting comps. It doesn’t take much, as we’ve explained with money laundering. 

CANADIAN REAL ESTATE IS WORSE THAN OFFICIAL DATA SHOWS, BMO REVISES FORECAST LOWER

Better Dwelling (2022-08-02)

Canadian real estate markets have seen a surge of listings being pulled and re-listed. An agent might have any number of reasons for delisting and relisting, but it does impact the stats. Homes that are canceled and relisted at a lower price don’t show a price cut or accurate days on market (DOM). It’s apparently a big issue in the Greater Toronto Area (GTA), warns BMO. 

ARGENTINA NAMES ECONOMY 'SUPER MINISTER' AS CRISIS DEEPENS

Yahoo Finance (2022-07-28)

The appointment comes only a few weeks since the left-leaning Silvina Batakis was tapped as economy minister after the more moderate Martín Guzmán abruptly quit, saying he wasn't getting political support in dealing with Argentina's economic woes.

CANADIANS EXPECT SECRECY FROM FEDERAL INSTITUTIONS, BUT THE CRTC TOOK US BY SURPRISE WITH ITS ROGERS REPORT

G&M - Rita Trichur (2022-07-27)

Yes, Rogers’ responses to the CRTC’s queries were partly redacted, but the regulator kept its word and divulged enough details to give Canadians a basic understanding of how a coding error caused the company’s network to malfunction earlier this month.

IMF SUPPORTS ARGENTINA’S NEW ECONOMY MINISTER AS CRISIS DEEPENS

Yahoo Finance - Patrick Gillespie (2022-07-25)

Argentine Economy Minister Silvina Batakis “agreed on the importance of decisive program implementation,” IMF Managing Director Kristalina Georgieva tweeted Monday after meeting the new minister, who retweeted the comment.

CENTRAL BANKS TO BLAME FOR INFLATION, FORMER RBNZ CHIEF SAYS

Yahoo Finance - Matthew Brockett (2022-07-25)

That’s the view of former New Zealand central bank governor Graeme Wheeler and Bryce Wilkinson, a senior research fellow with the New Zealand Initiative think tank, who have co-authored paper released Tuesday in Wellington titled: “How Central Bank Mistakes After 2019 Led to Inflation.”

EUROPEAN CENTRAL BANK HIKES BENCHMARK INTEREST RATE FOR FIRST TIME SINCE 2011 SOCIAL SHARING

CBC (2022-07-21)

"The interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be increased to 0.50 per cent, 0.75 per cent and 0.00 per cent respectively, with effect from 27 July 2022," the bank said, referring to various rates the central bank charges banks for loans, and fees for keeping deposits at the central bank for short time period.

'OUR CREDIBILITY IS BEING TESTED:' TIFF MACKLEM SAYS PATH TO SOFT LANDING IS NARROWING

FP - Stephanie Hughes (2022-07-21)

“Our credibility is being tested, and that was an important reason why we took an unusually large step last week to send a clear message to Canadians they can be assured that we’re going to control inflation,” Macklem told CTV News’s Evan Solomon on Wednesday following the June inflation figures.

MARIO DRAGHI RESIGNS, PLUNGING ITALY INTO POLITICAL TURMOIL

Reuters (2022-07-21)

It will be the first autumn national election for more than a century in Italy, where the second half of the year is normally taken up with getting the budget law through parliament.

R.I.P. FORWARD GUIDANCE: INFLATION FORCES CENTRAL BANKS TO DITCH MESSAGING TOOL

Reuters (2022-07-21)

If the U.S. Federal Reserve killed off forward guidance in June, the European Central Bank may have just hammered the final nail in the coffin of a tool officials had long used to provide monetary policy signals to financial markets.

HISTORY TAUGHT THE BANK OF CANADA WHAT HAPPENS WHEN IT DOESN’T CONTROL HIGH INFLATION

Investment Executive - Nojoud Al Mallees (2022-07-21)

“A big difference now is sort of a strongly held notion that it’s mostly the job of the Bank of Canada to look after inflation control,” said Williamson. “In the 70s, that wasn’t true.”

UKRAINE SEEKS FOREIGN-DEBT PAYMENT HALT AS WAR HITS ECONOMY

Yahoo Finance - Volodymyr Verbyany and Daryna Krasnolutska (2022-07-20)

Ukrainian officials have for weeks explored debt restructuring as the country’s funding options dry up and the war destroys its industry. The junk-rated sovereign faces mammoth $1.4 billion foreign-debt redemption and interest payments in September, according to Finance Ministry data.

THE DOLLAR SITS ATOP A GLOBAL MONETARY ORDER SHAKEN BY SANCTIONS

FT - Isabelle Mateos y Lago (2022-07-20)

Days after Russian troops invaded Ukraine, the G7 and a host of allies in Europe and Asia declared a freeze on the assets of the Central Bank of Russia.

BOJ TO RETAIN EASY POLICY, STAYING OUTSIDE GLOBAL TIGHTENING TIDE

Reuters - Leika Kihara (2022-07-20)

The decision will come hours before that of the European Central Bank, which will consider a bigger-than-expected 50 basis point rate increase to tame soaring inflation. While rising fuel and commodity costs have pushed Japan's inflation above its 2% target, the BOJ is in no rush to withdraw stimulus as slowing global growth cloud the outlook for an economy yet to fully recover from the COVID-19 pandemic's scars.

EXAMINING FEDERAL DEBT IN CANADA BY PRIME MINISTERS SINCE CONFEDERATION, 2022

Fraser Institute - Jake Fuss (2022-07-14)

Canada’s 23 prime ministers have each left a legacy, and each of those legacies has an effect on all Canadians. One element critical to an analysis of each prime minister is whether he or she left the federal government more or less indebted than when first taking office.

BANK OF CANADA READIES RARE 75-BASIS-POINT HIKE

Bloomberg - Erik Hertzberg (2022-07-13)

The Bank of Canada is set to deliver a super-sized interest rate hike this week, as it accelerates efforts to withdraw stimulus from an overheated economy and rein in soaring inflation.

BANK OF CANADA RAISES KEY INTEREST RATE BY 1 PERCENTAGE POINT, THE BIGGEST MOVE SINCE 1998

G&M - BARRIE MCKENNA AND MARK RENDELL (2022-07-13)

The Bank of Canada increased its benchmark interest rate by one percentage point on Wednesday, the most aggressive rate hike since 1998 and a larger move than investors and private-sector economists were expecting.

MONETARY POLICY REPORT PRESS CONFERENCE OPENING STATEMENT

BOC - Tiff Macklem (2022-07-13)

First, inflation is too high, and more people are getting more worried that high inflation is here to stay. We cannot let that happen. Restoring price stability—low, stable and predictable inflation—is paramount.

THE CASE FOR STRONG AND SILENT CENTRAL BANKS

Economist (2022-07-04)

Late on june 13th, a curious article appeared in the Wall Street Journal. It said that the Federal Reserve was “likely to consider” raising interest rates by 0.75 percentage points at its meeting on June 15th.
The article was unusually silent about its sources. And it proved uncannily prescient. Two days later the Fed did indeed raise interest rates by that amount, its biggest increase in 28 years. Many investors believe the central bank had used the press to warn financial markets about what it would do in advance (albeit not very far in advance). That would make the Journal story an unconventional example of “forward guidance”.

SENIOR CIVILIAN MOUNTIE REBUKES RCMP COMMISSIONER FOR ‘APPALLING’ BEHAVIOUR DURING NOVA SCOTIA SHOOTING INVESTIGATION

G&M (2022-06-29)

A senior civilian Mountie sent a strongly worded letter to RCMP Commissioner Brenda Lucki last year, accusing her of bowing to political pressure and displaying “unprofessional and extremely belittling” behaviour to officers investigating the worst mass shooting in Canadian history.

OSFI TAKES SMALL STEP TO LIMIT HOME-EQUITY BORROWING

G&M - Rachelle Younglai (2022-06-28)

Canada’s bank regulator plans to better protect the country’s financial system by limiting how much homeowners can borrow against the value of their homes.

FORD GOVERNMENT’S APPOINTMENT OF HEATHER ZORDEL AS OSC CHAIR PROMPTS RESIGNATIONS

G&M (2022-06-27)

The Ford government’s appointment of a Bay Street lawyer and Tory fundraiser to chair Ontario’s securities regulator has prompted two high-profile resignations, as well as concerns about her conduct and her dissenting views in her decisions regarding the laws that govern the capital markets.

RUSSIA DEFAULTS ON FOREIGN DEBT FOR FIRST TIME SINCE 1918

Bloomberg - Giulia Morpurgo and Libby Cherry (2022-06-27)

For months, the country found paths around the penalties imposed after the Kremlin’s invasion of Ukraine. But at the end of the day on Sunday, the grace period on about $100 million of snared interest payments due May 27 expired, a deadline considered an event of default if missed.

BIS PUTS CBDCS AT CENTRE OF FUTURE MONETARY SYSTEM

Finextra (2022-06-24)

In the cross-border context, the BIS Innovation Hub (BISIH) has been leading practical experiments to show how central bank digital currencies (CBDCs) could help deliver faster, cheaper and more transparent international payments.

BANK OF CANADA NEEDS MORE RESTRICTIVE INTEREST RATES TO CONTROL RUNAWAY INFLATION

G&M - DAVID PARKINSON (2022-06-23)

With every new inflation report, the job facing the Bank of Canada gets that much harder.

BANK OF CANADA DEPUTY GOVERNOR TIMOTHY LANE TO RETIRE IN SEPTEMBER

FP - CP (2022-06-23)

Lane joined the central bank in August 2008 as an adviser to the governor after 20 years at the International Monetary Fund.

THE AGE OF CREDIBILITY FOR CENTRAL BANKS IS OVER

Bloomberg - John Authers (2022-06-23)

Monetary regimes don’t fall often. Half a century ago, in 1971, Richard Nixon ended the Age of Gold by formally eliminating the dollar’s peg to the precious metal. Since then, the dollar and other currencies have rested on fiat—they’re worth something because governments say they are. You could call this the Age of Credibility. In place of gold, currency’s anchor is the trust in the central banks that issue them. Now credibility appears to be at an end. With central banks desperately ripping up their playbooks to try to rein in inflation that’s veered far beyond target, they’re admitting they’ve been wrong, and giving up on trying to steer the markets on their plans for the future.

CENTRAL BANK DIGITAL CURRENCIES POISED TO BE THE FOUNDATION OF THE FINANCIAL SYSTEM, BIS SAYS

FP - Stephanie Hughes (2022-06-22)

“The technology and the technical issues are not that difficult, but once you have more than one jurisdiction involved, there are the policies and the regulations that of course, need to be reconciled,” said the BIS’s Hyun Song Shin. “What are some of the legal differences across jurisdictions that might mean that smooth flows might be impeded? So, there are more of these policy challenges that actually rear their heads in the wholesale application.”

POWELL FACES RISING CRITICISM FOR INFLATION MISSTEPS

Investment Executive - Christopher Rugaber (2022-06-22)

Inflation has proved higher and far more persistent than he or the Fed’s staff economists had foreseen. And at a policy meeting last week, Powell announced an unusual last-minute switch to a bigger interest rate hike than he had previously signaled — and then followed with a news conference that many economists described as muddled and inconsistent.

TRUDEAU IS SHIRKING CANADA’S INFLATION FIGHT, SCOTIABANK SAYS

Bloomberg - Stephen Wicary (2022-06-20)

One of Canada’s largest commercial banks fired a broadside at Prime Minister Justin Trudeau’s government, warning that high levels of federal spending are hurting the fight against inflation.

GET READY FOR INTEREST RATES TO CLIMB ‘A LOT HIGHER,’ SAYS FIRST TRUST ECONOMIST

Investment Executive - Greg Meckbach (2022-06-20)

“We think it was obvious inflation would be an issue over the last couple of years, and we believe it will continue to be an issue until we get the money supply under control,” Elass told advisors during the First Trust ETF Institute, held at the Royal York Hotel.

RE-OPENING KEYSTONE PIPELINE TALKS WON’T ADDRESS CURRENT HIGH OIL PRICES, YELLEN SAYS FOLLOWING MEETING WITH FREELAND

G&M - Bill Curry (2022-06-20)

Finance Minister Chrystia Freeland and U.S. Treasury Secretary Janet Yellen have pledged to help central banks tackle inflation by cutting back on deficit spending, but Ms. Yellen was cool to reopening Keystone pipeline talks as a way to reduce oil prices.

THE EUROPEAN CENTRAL BANK IS RUNNING OUT OF AMMUNITION TO FIGHT A NEW DEBT CRISIS

G&M - Eric Reguly (2022-06-20)

Almost exactly a decade ago, Mario Draghi, then the president of the European Central Bank, promised to do “whatever it takes” to save the euro from destruction. At the time, Greece was on the verge of stumbling – or being frogmarched – out of the euro zone; Italy, the region’s third-largest economy, was so mired in debt that it, too, seemed a candidate for departure.

CANADA’S FEDERAL ANTI-MONEY LAUNDERING RESOURCES ARE UNRELIABLE: BC PUBLIC INQUIRY

Better Dwelling (2022-06-17)

All flash and no (illicit) cash. That was the key takeaway from the Cullen Commission‘s final report looking at BC’s money laundering problem. Despite Canada talking a big game on anti-money laundering, its policies are ineffective. The Commission condemned federal anti-money laundering resources, and found Canada ignored the province’s calls for help. Austin Cullen, who led the Commission, concluded Federal resources aren’t reliable. The Province should therefore establish its own dedicated anti-money laundering enforcement team.

WHAT THE CRYPTO CRASH SAYS ABOUT PIERRE POILIEVRE’S JUDGMENT

G&M - Gary Mason (2022-06-16)

However, he can and should be questioned today about his enthusiasm for, if not outright promotion of, cryptocurrency.

CHRYSTIA FREELAND DETAILS $8.9B IN MEASURES TO TACKLE AFFORDABILITY IN FIRST MAJOR SPEECH SINCE BUDGET

CBC - Peter Zimonjic (2022-06-16)

Freeland said her plan to address inflation and the affordability crisis has five parts: respecting the role of the Bank of Canada, investing in workers, managing the debt, creating good jobs and funding the suite of programs that make up the Affordability Plan.

FP CANADA WANTS 4 MORE PROVINCES TO EMBRACE TITLE REG BY 2025

Investment Executive (2022-06-15)

Under the category of government relations, FP Canada stated it would like governments to “recognize financial planning as a profession and support its broad accessibility, through appropriate policy and regulatory frameworks” over the next three years.

U.S. FEDERAL RESERVE HIKES TARGET INTEREST RATE BY 0.75 PERCENTAGE POINT, FLAGS SLOWING ECONOMY

G&M - ANN SAPHIR AND HOWARD SCHNEIDER (2022-06-15)

The Federal Reserve on Wednesday approved its largest interest rate increase in more than a quarter of a century to stem a surge in inflation that U.S. central bank officials acknowledged may be eroding public trust in their power, and being driven by events seen increasingly out of their hands.

TRUDEAU’S FINANCE CHIEF TO LAY OUT PLAN TO COPE WITH INFLATION

Bloomberg - Brian Platt (2022-06-15)

Justin Trudeau’s finance minister will use a keynote speech to make the case that Canada’s government is ready to tackle affordability issues as consumer prices soar and borrowing costs rise sharply.

YAHOO FINANCE 'NEVER SAY NEVER': WALL STREET CONTEMPLATES A SHOCK DECISION FROM THE FED

Yahoo Finance - Brian Cheung (2022-06-14)

“Some think the Fed could deliver a surprise 75bp hike at the June meeting. Never say never in these circumstances but we think that remains very unlikely,” Evercore ISI analysts wrote Friday.

BOE EXPECTED TO GO FASTER AND FURTHER ON RATES, POLL FINDS

Bloomberg (2022-06-14)

The central bank, which had been expected to pause after hiking to 1.5%, is now predicted to lift the benchmark cost of borrowing to 2% by this time next year, according to economists surveyed by Bloomberg last week.

THE ECB IS NO LONGER AN INFLATION-TARGETING CENTRAL BANK

Bloomberg - Richard Cookson (2022-06-13)

Central banks have scarcely covered themselves in glory these past few years.  Most have one goal and one goal only: to keep inflation low. In most countries, they have spectacularly failed at this job. In much of the developed world, inflation has reached many multi-year highs. But bar Turkey’s, I can’t think of a central bank whose record has been as lamentable as the European Central Bank. At least its Turkish counterpart has the excuse of being under the thumb of Recep Erdogan, the country’s president, whose contributions to economics are on a par with Vladimir Putin’s to international diplomacy. 

BILL MORNEAU TALKS ABOUT THE LIBERALS’ ECONOMIC POLICY FAILINGS AS IF THEY WERE SOMEONE ELSE’S FAULT

G&M - DAVID PARKINSON (2022-06-07)

Bill Morneau isn’t wrong about the Liberal government’s failure to deliver on a long-term economic growth plan. It’s just odd that he talks about it as if it’s someone else’s fault. An awful lot of what he has criticized happened on his watch.

AUSTRALIAN CENTRAL BANK HIKES RATE FOR 2ND TIME IN 5 WEEKS

Yahoo Finance (2022-06-07)

Australia’s central bank on Tuesday lifted its benchmark interest rate for a second time in five weeks, changing the cash rate to 0.85% from 0.35%.

CENTRAL BANKERS DON’T KNOW HOW TO TACKLE INFLATION

Bloomberg - Mark Gilbert (2022-06-06)

The Federal Reserve, the European Central Bank and the Bank of England all preside over inflation rates that have surged to quadruple their 2% targets. One of their brethren is highly skeptical of their chances of success in calming price increases. It may turn out that they’ve been lucky rather than good in achieving price stability in recent years — and their luck has run out.

FED DELIVERS FUZZIER RATE MESSAGE AS IT GAUGES IMPACT OF HIKES

Bloomberg - Craig Torres (2022-06-06)

At the start of the hiking cycle, Chair Jerome Powell said the goal was “getting rates back up to more neutral levels as quickly as we practicably can.” In May, however, he walked back from the concept of neutral -- a level that neither slows nor speeds up growth -- cautioning that the discussion had a “sort of false precision.”

MORNEAU CRITICIZES LIBERALS’ ECONOMIC POLICIES IN FIRST PUBLIC SPEECH SINCE LEAVING POLITICAL LIFE

G&M - Andrew Willis (2022-06-02)

Former finance minister Bill Morneau delivered a pointed critique of the federal Liberals’ economic policies, along with a series of recommendations for kickstarting growth, in his first public speech since leaving political life two years ago.

BANK OF CANADA RAISES BENCHMARK INTEREST RATE TO 1.5%, SIGNALS MORE HIKES ON THE WAY

CBC - Pete Evans (2022-06-02)

"With ... inflation persisting well above target and expected to move higher in the near term, the [bank] continues to judge that interest rates will need to rise further," the central bank said in a statement.

CANADA'S ECONOMIC GROWTH SLOWS TO 3.1%: WHAT YOU NEED TO KNOW

FP - Kevin Carmichael (2022-06-01)

For what it’s worth, Bay Street’s average forecast ahead of the release was for growth of about five per cent, so there will be some disappointment, or maybe relief, considering growth at that pace would continue to fuel worries that the central bank had lost its grip on inflation. The Bank of Canada has been struggling to get a read on prices, but it appears to have a better idea of what’s going on with GDP.

BANK OF CANADA FACES CREDIBILITY TEST IN POLITICAL FIRESTORM OVER INFLATION

Bloomberg - Theophilos Argitis (2022-05-31)

If worrying about an overheating economy wasn’t enough trouble, Bank of Canada Governor Tiff Macklem enters a crucial six-week period in his battle against inflation with an unexpected new problem: questions about his own credibility.

BANK OF CANADA EXPECTED TO ANNOUNCE ANOTHER SUPERSIZED INTEREST RATE HIKE TO HELP TEMPER INFLATION

G&M - Mark Rendell (2022-05-30)

The Bank of Canada is expected to announce another oversized interest rate increase this week, part of its effort to push Canadian borrowing costs rapidly higher in the hope of slowing the pace of consumer price growth.

CANADA PROPOSES GUIDELINES TO MANAGE FINANCIAL RISKS FROM CLIMATE CHANGE

Yahoo Finance (2022-05-27)

The guidelines, issued by the Office of the Superintendent of Financial Institutions (OSFI), call for annual climate-related disclosures on governance, strategy, risk management, metrics and targets, and greenhouse gas emissions, as well as a transition plan, for periods starting October 2023.

U.S. FED EMBRACES 50-BASIS-POINT RATE HIKES IN JUNE, JULY TO CURB ‘VERY HIGH’ INFLATION

G&M - Howard Schneider (2022-05-26)

All participants at the Federal Reserve’s May 3-4 policy meeting backed a half-percentage-point rate increase to combat inflation they agreed had become a key threat to the economy’s performance and was at risk of racing higher without action by the U.S. central bank, minutes of the session showed on Wednesday.

FED OFFICIALS RAISED POSSIBILITY OF ‘RESTRICTIVE’ POLICY TO FIGHT INFLATION

FT - James Politi (2022-05-26)

Federal Reserve officials discussed the possibility of moving the US central bank to a “restrictive” policy stance that would better fight inflation through more aggressive interest rate increases, but worried that this could undermine the strong recovery in the jobs market.

DELAYS TO OTTAWA’S PLEDGE TO LOWER CREDIT CARD TRANSACTION FEES HAS SMALL BUSINESSES WORRIED

G&M - Chris Hannay (2022-05-25)

Independent retailers have an array of overhead costs, but there is one that Juliann Barry calls the silent killer: credit-card transaction fees.

RUBLE RALLY POWERS ON EVEN AFTER CAPITAL CONTROLS DIALED BACK

Yahoo Finance - Bloomberg (2022-05-24)

The ruble was stronger for a fifth day against the dollar, trading up 2% even after Russia on Monday loosened capital controls by reducing the amount of foreign currency exporters are required to convert.

FINANCE MINISTER CHRYSTIA FREELAND DEFENDS BANK OF CANADA AMID POILIEVRE ATTACKS

FP - Julie Gordon (2022-05-24)

“It is clear to us all that we are living through a period of global volatility. We have COVID. We have the Russian invasion of Ukraine. We have China’s zero-COVID policy,” Freeland told reporters by teleconference from Munich, Germany after a G7 meeting.

UK REGULATOR COUNTERS CLIMATE DENIER CLAIM

Reuters - Carolyn Cohn (2022-05-24)

UK pension schemes should not ignore climate change, a senior executive at The Pensions Regulator said on Monday, the first watchdog to weigh in after a top HSBC banker was suspended after playing down the financial risks of climate change.

ALBERTA PREMIER JASON KENNEY RESIGNING AS UCP LEADER DESPITE NARROW WIN IN LEADERSHIP REVIEW

CBC - Michelle Bellefontaine (2022-05-19)

Alberta Premier Jason Kenney announced his resignation as United Conservative Party leader Wednesday after receiving 51.4 per cent approval of his leadership from UCP members.

CHINA SAYS SENIOR CENTRAL BANK OFFICIAL UNDER INVESTIGATION

Bloomberg (2022-05-18)

Born in 1972, Sun joined the People’s Bank of China in 1996 and has spent most of his career at the monetary policy department. He’s been at the forefront of the PBOC’s transformation into a modern central bank over the years and took part in many key milestones, including creating the interbank bond market, launching open market operations, establishing the yuan exchange rate forming mechanism, and most recently, revamping the interest rates.

US SET TO BLOCK RUSSIAN DEBT PAYMENTS, RAISING DEFAULT ODDS

Bloomberg - Seleha Mohsin (2022-05-18)

The end of the carve-out could be the final straw in Russia’s debt saga after almost three months of war in Ukraine. It’s managed to make all its payments to creditors so far, weaving through the tangle of sanctions that closed off some avenues.

YAHOO FINANCE POWELL: 'SOME PAIN' MAY BE REQUIRED TO SLOW INFLATION

Yahoo Finance - Brian Cheung (2022-05-18)

Federal Reserve Chairman Jerome Powell said Tuesday that the central bank will continue to raise short-term interest rates — which will likely slow economic activity — until there is “clear and convincing evidence” that inflation is coming down.

ECB TELLS BANKS TO BUCKLE UP AS UKRAINE WAR HITS ECONOMY

Reuters (2022-05-18)

"We have asked banks to reassess their projections and capital trajectories in the light of the new macroeconomic picture, also considering adverse scenarios," Enria told Italian daily Repubblica.

THAT TIME THE PRIME MINISTER SQUARED OFF AGAINST THE CENTRAL BANKER

FP - Joe O'Connor (2022-05-16)

“I don’t want to seem like a flashy Joe,” he would say.

YAHOO FINANCE CANADA VIDEOS WHY BANK OF CANADA CRITICISM IS JUSTIFIED

Yahoo Finance - Yahoo (2022-05-16)

On this episode of Editor's Edition, Yahoo Finance Canada's Alicja Siekierska and the Public Policy Forum's Sean Speer discuss the criticism being aimed at the Bank of Canada. Speer argues that the debate around the Bank’s decisions – as well as of other institutions – is justified in the post-pandemic recovery.

INTEREST RATE TRAJECTORY WILL DEPEND HEAVILY ON HOUSING MARKET, BANK OF CANADA DEPUTY GOVERNOR SAYS

G&M - Mark Rendell (2022-05-13)

The Bank of Canada needs to keep raising interest rates to tackle runaway inflation, deputy governor Toni Gravelle said on Thursday – although how high rates go will depend on how the housing market responds to rising borrowing costs.

PIERRE POILIEVRE FANS FRUSTRATION ABOUT CANADA’S INFLATION WOES

G&M - DAVID PARKINSON (2022-05-13)

In his loud and frequent criticism of the Bank of Canada, Pierre Poilievre has been getting a lot of mileage out of how the central bank started the COVID-19 crisis thinking deflation, not inflation, would be the country’s big worry. The Conservative Party leadership candidate recently called the bank’s brain trust “financially illiterate” for getting the inflation call so badly wrong.

BANK OF CANADA’S 1% POLICY RATE ‘TOO STIMULATIVE,’ GRAVELLE SAYS

Yahoo Finance - Erik Hertzberg (2022-05-13)

Speaking in Montreal, the deputy governor outlined how higher commodity prices, global supply chain issues, and the reopening of economies are pushing up inflation. Gravelle also said that the bank’s near-term forecasts for price gains are likely to be revised up, adding that “inflation pressures have been higher and more tenacious than we expected.”

WHAT YOU NEED TO KNOW ABOUT PIERRE POILIEVRE'S THREAT TO FIRE TIFF MACKLEM

FP - Kevin Carmichael (2022-05-13)

Here’s what Poilievre, member of Parliament for Carleton, a riding on the outskirts of Ottawa, said he’d do with Macklem during a debate with the other leadership candidates in Edmonton on May 11: “I would replace him with a new governor who would reinstate our low-inflation mandate, protect the purchasing power of our dollar, and honour the working people who earned those dollars.”

U.S. SENATE CONFIRMS POWELL FOR SECOND TERM AS FED CHIEF IN BIPARTISAN VOTE

Reuters - David Morgan (2022-05-13)

Most of the nays were Republicans, though a few Democrats, including Robert Menendez and Elizabeth Warren, joined them. Menendez said Powell had not done enough to promote diversity in the Fed's leadership, while Warren said he had fallen short on bank regulation.

'WE'RE NOT GETTING IT PERFECT': CAROLYN ROGERS SAYS THE BANK OF CANADA IS LEARNING FROM ITS MISTAKES

FP - Kevin Carmichael (2022-05-12)

The Bank of Canada’s leaders dislike how they’ve been dragged into a partisan political contest. But they didn’t need Pierre Poilievre’s emergence as Canada’s answer to former United States congressman Ron Paul to know that a segment of the population has lost faith in them.

ECB TO START RAISING RATES GRADUALLY THIS SUMMER - VILLEROY

Reuters - Reuters (2022-05-11)

He said he expected inflation to remain "high" for the rest of 2022 but added that inflation should get back down to around the 2% level by 2024.

FED WARNS OF WORSENING MARKET LIQUIDITY IN STABILITY REPORT

Bloomberg - Matthew Boesler (2022-05-10)

The Federal Reserve warned of deteriorating liquidity conditions across key financial markets amid rising risks from the war in Ukraine, monetary tightening and high inflation in a semi-annual report published Monday.

BANK OF CANADA'S CAROLYN ROGERS SAYS SUPPLY IS THE KEY TO SOLVING HOUSING PROBLEM

FP - Stephanie Hughes (2022-05-06)

“We have to fix the supply problem,” Rogers said this week in an interview, her first since replacing Carolyn Wilkins as governor Tiff Macklem’s No. 2 in December. “We keep trying these different things to dampen demand and Canadians still want houses. We have immigration coming in, (and) we have a strong economy.”

BOC REACHING OUT TO INDIGENOUS GROUPS ON ECONOMIC RECONCILIATION

Investment Executive - CP (2022-05-06)

Schembri says the central bank hopes it can take a meaningful step toward building trust and strengthening its relationship with Indigenous peoples.

U.S. FEDERAL RESERVE RAISES INTEREST RATE BY HALF POINT, LARGEST HIKE IN TWO DECADES

G&M - Mark Rendell (2022-05-05)

Fed chair Jerome Powell said he expects the committee will consider increasing the policy rate by 50 basis points at each of its next two meetings, which would bring the Fed Funds rate back above prepandemic levels by the middle of the summer. At the same time, he seemed to rule out an increase of 75 basis points, saying that “is not something the committee is actively considering.”

BANK OF CANADA OPENED THE DOOR FOR TODAY’S INDEPENDENCE QUESTIONS AT A PODIUM TWO YEARS AGO

G&M - DAVID PARKINSON (2022-05-05)

What was striking about the speech this week from the Bank of Canada’s No. 2 official on the importance of central-bank independence wasn’t what she had to say. It was that the bank felt compelled to say it at all.

INFLATION IN TURKEY SOARS TO EYE-POPPING NEAR 70% IN APRIL

Yahoo Finance - Yahoo (2022-05-05)

Turkey’s central bank has cut rates by 5 percentage points since September, to 14%, despite high inflation rates — before pausing them in January. The Turkish lira lost 44% of its value against the U.S. dollar last year.

BANK OF ENGLAND SET FOR 4TH STRAIGHT RATE HIKE TO FIGHT INFLATION

Reuters - William Schomberg (2022-05-05)

The Bank of England looks poised to raise interest rates on Thursday for the fourth time since December, the fastest increase in borrowing costs in a quarter of a century as it tries to quell the danger from the leap in inflation.

CENTRAL BANKERS ARE HANDCUFFED BY OLD NARRATIVES

Bloomberg - Clive Crook (2022-05-05)

In the space of a few short months, the prevailing narrative on U.S. inflation has veered from “It’s transitory” to “We have a problem.” This week, the Federal Reserve took another step toward acknowledging this, raising its policy rate by 50 basis points and leading investors to expect a faster pace of tightening from now on. That’s fine, you might say, the facts have changed – and to paraphrase John Maynard Keynes, when the facts change, you change your story. What’s interesting is that the story has changed more abruptly than the facts.

BANK OF CANADA DEFENDS ITS CREDIBILITY AND INDEPENDENCE IN FACE OF SOARING INFLATION, CONSERVATIVE CRITICISM

G&M - Mark Rendell (2022-05-04)

The Bank of Canada has ramped up efforts to defend its credibility amid soaring inflation and pointed criticism from Conservative politicians who say it has lost its independence from the government.

THE FED IS ABOUT TO DO SOMETHING IT HAS NOT DONE IN TWO DECADES

Yahoo Finance - Brian Cheung (2022-05-04)

RAPID RATE HIKES CRITICAL TO ‘BREAK’ RISING INFLATION EXPECTATIONS, SAYS FORMER BOC GOVERNOR DAVID DODGE

G&M - DAVID PARKINSON (2022-05-03)

David Dodge has been in the corridors of Canadian economic policy making and the battle against inflation for a half-century.

DAVID ROSENBERG: THE FED IS TIGHTENING AND THAT USUALLY MEANS RECESSION, NO MATTER WHAT THEY SAY

FP - David Rosenberg (2022-05-02)

Recent research from a number of sources also cast doubt on Powell’s statement. As such, rather than buying into the Fed’s fantasy, inventors should exercise caution and shift away exposure from cyclical sectors into more defensive ones.

TIFF MACKLEM ACKNOWLEDGES MISJUDGING INFLATION, PLEDGES TO ACT 'FORCEFULLY' TO BRING IT DOWN

FP - Stephanie Hughes (2022-04-29)

“(We’re coming) out of the deepest recession we’ve ever had,” Macklem said during testimony at the Senate banking committee late on April 27. “We got a lot of things right. We got some things wrong, and we are adjusting.”

TIFF MACKLEM DOUBLES DOWN ON MESSAGE THAT CANADIANS SHOULD PREPARE FOR HIGHER INTEREST RATES

G&M - Mark Rendell (2022-04-28)

The Bank of Canada is prepared to raise interest rates “forcefully if needed” to get inflation under control, Governor Tiff Macklem said Wednesday, doubling down on the message that Canadian households and businesses should brace for higher borrowing costs over the coming year.

NEW INVESTING ORDERS SHOULD MAKE IT SIMPLER TO DEPLOY FUNDS: INFRASTRUCTURE BANK CEO

Yahoo Finance - Yahoo (2022-04-27)

The Liberals infused the infrastructure bank with $35 billion in federal financing to pull in two or three times that in private dollars, arguing it would stretch Ottawa's capacity to fund the building of more roads, bridges, energy, water and wastewater systems.

MACKLEM HINTS AT A SECOND HALF-POINT RATE HIKE, WHILE DOUSING TALK HE COULD GO BIGGER

FP - Kevin Carmichael (2022-04-26)

“Anything bigger than a 50-point increase would be very unusual,” Macklem said during testimony at the House finance committee on April 25.

BANK OF CANADA REBUKES CLAIMS PIERRE POILIEVRE HAS MADE ON INFLATION, CRYPTOCURRENCY

National Post - Catherine Levesque (2022-04-26)

Poilievre, who lost his role as Finance critic ever since he decided to run for his party’s main job, was not there to butt heads against Bank of Canada Governor Tiff Macklem and Deputy Governor Carolyn Rogers during the Parliamentary Finance Committee on Monday.

THE BANK OF CANADA RELEASES ITS ANNUAL REPORT FOR 2021

BOC - BOC (2022-04-26)

The Bank of Canada’s Annual Report for 2021 was tabled in the House of Commons today. The Report is now available on the Bank’s website.

OPENING STATEMENT BEFORE THE HOUSE OF COMMONS STANDING COMMITTEE ON FINANCE

BOC - Tiff Macklem (2022-04-26)

The Bank’s primary focus is inflation. Consumer price index (CPI) inflation in Canada hit a three-decade high of 6.7% in March, well above what we projected in the January MPR. The war has driven up the prices of energy and other commodities, and it is further disrupting global supply chains. While most of the factors pushing up inflation come from beyond our borders, with the economy in excess demand, we are facing domestic price pressures too. About two-thirds of CPI components are growing above 3%, which means Canadians are feeling inflation across their household budgets, from gas to groceries to rent.

HIGHER RATES WILL COST CANADIANS BILLIONS IN GOVERNMENT DEBT INTEREST

FP - Tegan Hill and Jake Fuss (2022-04-25)

In the decade leading up to the pandemic, Canadian governments collectively accumulated approximately $525 billion in net debt — this despite a growing national economy in nine of the 10 years. COVID-19 then exacerbated the problem, as governments increased spending and amassed hundreds of billions in additional debt during 2020 and 2021. In its recent budget, the federal government alone projects its net debt will surpass $1.3 trillion this fiscal year (2022-23) and continue climbing until at least 2026-27.

MACRON DEFEATS LE PEN TO BE RE-ELECTED FRENCH PRESIDENT

FT - Victor Mallet, Leila Abboud and Sarah White (2022-04-25)

Emmanuel Macron has defeated his far-right rival Marine Le Pen to be re-elected president of France, vowing to tackle the country’s “doubts and divisions” during his second five-year term.

BANK OF CANADA’S TIFF MACKLEM WON’T RULE OUT EVEN LARGER INTEREST RATE HIKES

G&M - Mark Rendell (2022-04-22)

The Bank of Canada might consider hiking its benchmark interest rate by more than 50 basis points in a single move as it pushes borrowing costs higher to try to quell runaway inflation, Governor Tiff Macklem suggested on Thursday.

BUILDING BACK BIGGER: HOW OTTAWA GREW UNDER COVER OF COVID

FP - William Robson and Alexandre Laurin (2022-04-22)

The 2022 federal budget highlights their success. Ottawa’s last pre-COVID projections, in its 2019 fall update, showed federal spending at $421 billion in fiscal year 2024-25. The 2022 budget’s projections have it at $479 billion a year (adding back $2 billion in pension obligations the government stopped including meanwhile). That’s $58 billion more, long after COVID-related measures are gone. The slogan we should have been hearing is “Build back bigger!”

BOE'S BAILEY SAYS THERE SHOULD BE "NO APPEASEMENT" OF RUSSIA

Reuters - Reuters (2022-04-22)

Western countries should not appease Russia following its invasion of Ukraine even if there are difficult economic consequences, Bank of England Governor Andrew Bailey said on Thursday.

CAN THE BANK OF CANADA POSSIBLY GET INFLATION BACK DOWN NEAR 2 PER CENT?

G&M - DAVID PARKINSON (2022-04-21)

With every monthly release of Canada’s consumer price index, the gap between inflation and the Bank of Canada’s 2-per-cent target grows more cavernous – and the task to close it increasingly Herculean.

RUSSIA SAYS IT WILL NO LONGER DISCLOSE THE NAMES OF ORGANIZATIONS THAT USE ITS ALTERNATIVE TO THE SWIFT PAYMENT SYSTEM

Yahoo Finance - Huileng Tan (2022-04-20)

"Under the current conditions we have made the decision not to reveal the list of organisations connected to SPFS. Still, this list is available for users of the system," the Russian central bank told Reuters in an email. The institution used to publish a list of SPFS users on the website but recently stopped the practice, per Bloomberg.

CALLING TIME ON QE, CENTRAL BANK ASSET CULL ADDS NEW MARKET RISKS

Reuters - Howard Schneider and William Schomberg (2022-04-20)

Major central banks, already plotting interest rate hikes in a fight against inflation, are also preparing a common pullback from key financial markets in a first-ever round of global "quantitative tightening" expected to restrict credit and add stress to an already-slowing world economy.

RUSSIAN CENTRAL BANKER NABIULLINA GETS HIT WITH SANCTIONS

Bloomberg - Brian Platt (2022-04-20)

Canada sanctioned Russian central bank Governor Elvira Nabiullina and 13 other “close associates of the Russian regime” in a fresh round of penalties related to the war in Ukraine.

RUSSIA'S DEBT DEFAULT WILL BE ONE OF THE HARDEST IN HISTORY TO RESOLVE AND COULD SEE THE US SEIZE THE CENTRAL BANK'S ASSETS, ECONOMIST SAYS

Yahoo Finance - Harry Robertson (2022-04-19)

EU WARNS PUTIN’S RUBLES-FOR-GAS DEMAND WOULD BREAK SANCTIONS

Yahoo Finance - Alberto Nardelli (2022-04-14)

European governments -- and companies -- are still grappling with what the decree means in operational terms. The person said the EU would work with national authorities to inform European companies that hold contracts of the assessment and provide guidance. The Dutch government has backed the EU analysis and said it won’t allow its companies to follow through with the Russian payment demand.

CIRCLING THE TOILET BOWL OF SOCIALISM

FP - Matthew Lau (2022-04-13)

Had I been in charge of titling last week’s federal budget, it would have been called something like “Circling the toilet bowl of socialism.” We’re not quite in the bowl yet, but with this budget, we’re circling it. The Liberals instead called their budget “A Plan to Grow Our Economy and Make Life More Affordable,” a far less accurate description, for their policies are exactly the opposite of what they should be if they really want to grow the economy. As a matter of basic economics, to encourage economic growth, taxes must be low, simple, predictable, and broadly applied, in order to minimize distortions and provide certainty. The Liberals have broken all the rules of sensible taxation by making taxes higher, more distortionary, more arbitrary, and less certain.

IS NEW ZEALAND RAISING RATES INTO A RECESSION?

Bloomberg - Daniel Moss (2022-04-13)

For New Zealand, having the most hawkish central bank in Asia doesn't go far enough. Officials are intensifying their battle against inflation, even as confidence ebbs and the vital housing industry teeters. Is the country racing toward a recession?

MONETARY POLICY REPORT – APRIL 2022

BOC - Tiff Macklem (2022-04-13)

11 AM today Maklem will disuss BOC monetary policy.

BANK OF CANADA EXPECTED TO ANNOUNCE OVERSIZED RATE HIKE THIS WEEK

G&M - Mark Rendell (2022-04-11)

The Bank of Canada is expected to announce its first oversized interest-rate hike in more than two decades this week after hawkish comments from the country’s top central bankers and growing signs that the economy is overheating.

RUSSIA CALLS FOR INTEGRATING BRICS PAYMENT SYSTEMS

Reuters - Reuters (2022-04-11)

 Russia, hit by Western sanctions, has called on the BRICS group of emerging economies to extend the use of national currencies and integrate payment systems, the finance ministry said on Saturday.

RUSSIA TO HALT BOND SALES FOR THIS YEAR AS INTEREST COSTS SURGE

Bloomberg - Kira Zavyalova (2022-04-11)

Russia will halt bond auctions for the remainder of 2022 due to prohibitive borrowing costs, Finance Minister Anton Siluanov was quoted as saying by Russian newspaper Izvestia.

FEDERAL BUDGET EARMARKS $56-BILLION IN NEW SPENDING, HIGHER TAXES AS CRITICS FEAR IT WILL FUEL INFLATION

G&M - Bill Curry (2022-04-08)

The federal government’s 2022 budget plan lays out more than $56-billion in new spending over six years, as part of a package Finance Minister Chrystia Freeland says will boost innovation and green technology.

FEDERAL BUDGET 2022 TO INCLUDE $10-BILLION FOR AFFORDABLE HOUSING

G&M - Bill Curry (2022-04-07)

Finance Minister Chrystia Freeland will table a budget on Thursday that promises $10-billion to make housing more affordable for Canadians, provides $8-billion in new defence spending, and aims to spur economic growth through green initiatives and a small-business tax cut.

CAN THE FED SHRINK ITS $9TN BALANCE SHEET WITHOUT CAUSING MARKET MAYHEM?

FT - Colby Smith (2022-04-07)

After months of debate, the Federal Reserve has a plan to shrink its $9tn balance sheet as it tries to tighten monetary policy and tackle the highest inflation in decades.

CANADA’S SUPERCLUSTERS AWAIT FATE IN 2022 FEDERAL BUDGET AS FUNDING DWINDLES

G&M - Sean Silcoff (2022-04-07)

It was the centrepiece of the federal Liberal government’s first innovation strategy: a $950-million “supercluster” program aimed at bringing together academia and business to collaborate in unprecedented ways, spinning out companies and creating jobs, economic growth and intellectual property.

SCOTIABANK CEO CALLS FOR FEDERAL COMMISSION TO STUDY LONG-TERM ECONOMIC GROWTH ISSUES

G&M - James Bradshaw (2022-04-06)

Bank of Nova Scotia 

MP REMPEL GARNER PUSHES FOR NATIONAL CRYPTO REGULATION FRAMEWORK IN BILL

FP - Stephanie Hughes (2022-04-06)

Bill C-249, which saw its first reading in early February, would call on the Minister of Finance to consult with crypto industry innovators designated by provinces and territories to develop the framework. The bill also states that policy must focus on lowering barriers to entry in the crypto sector and protect industry innovators from crushing administrative burdens.

BANK OF CANADA SURVEY SHOWS MOST BUSINESSES THINK IT WILL TAKE AT LEAST TWO YEARS TO GET INFLATION UNDER CONTROL

FP - Kevin Carmichael (2022-04-05)

The central bank polls a representative group of companies every quarter to give it a sense of the mood inside the country’s C-suites. It was no surprise the latest Business Outlook Survey turned up anxiety over prices, which have risen to the highest in more than three decades, according to Statistic Canada’s consumer price index.

THE BIG RIFT: CORPORATE CANADA WANTS OTTAWA TO FOCUS ON REAL GROWTH, NOT ‘SUGAR POPS’ ECONOMICS

G&M - James Bradshaw (2022-04-04)

One week before the release of the federal government’s pivotal 2022 budget, Royal Bank of Canada chief executive Dave McKay was uneasy as he surveyed the daunting challenges ahead for Canada’s economy.

BANK OF CANADA’S TIFF MACKLEM TAKES ON NEW ROLE OVERSEEING GLOBAL BANK RULES

G&M - Mark Rendell (2022-04-04)

Bank of Canada governor Tiff Macklem is taking on a new role overseeing the global banking system as the chair of a group of central bankers that oversees the Basel Committee on Banking Supervision.

BRACE YOURSELF: INTEREST RATES COULD BE HEADED UP EVEN FASTER AND HIGHER THAN WE THOUGHT SOCIAL SHARING

CBC - Pete Evans (2022-04-01)

While economists expect the bank to gradually raise its rate another half-dozen times or so this year, there's a growing sense that the bank may need to start moving faster and more dramatically than anticipated to rein in inflation, which is already at its highest level in a generation.

FAITH IN BANK OF CANADA INFLATION-FIGHTING CHOPS CLIMBS IN POLL

Bloomberg - Erik Hertzberg (2022-03-31)

Although a majority of Canadians are still doubtful inflation will be reined in, even a small pick-up in confidence is a welcome development for policymakers led by Governor Tiff Macklem. Bank of Canada officials have been warning they plan to act decisively with aggressive rate hikes to quell inflation, which has hit a three-decade high of 5.7%.

WHY THE BANK OF CANADA IS NOW 'TALKING TOUGH' ON INFLATION

FP - Larysa Harapyn (2022-03-30)

Dennis Mitchell, CEO and CIO at Starlight Capital, talks with Financial Post’s Larysa Harapyn about why the Bank of Canada is now ‘talking tough’ on inflation.

TRUDEAU CLIMATE PLAN SEEKS 42% CUT IN OIL AND GAS EMISSIONS

Yahoo Finance - Brian Platt, Robert Tuttle (2022-03-30)

Trudeau’s blueprint promises industry a tax credit to help pay for carbon-capture projects, details of which may come as soon as next week’s federal budget. It doesn’t, however, include a specific emissions cap on the fossil-fuel sector, which accounts for about a tenth of Canada’s total economic output.

UKRAINE OFFERS NEUTRALITY IN EXCHANGE FOR NATO-STYLE SECURITY GUARANTEES AT RUSSIA TALKS

Reuters - Reuters (2022-03-30)

Ukraine proposed adopting neutral status in exchange for security guarantees at talks with Russia in Turkey, meaning it would not join military alliances or host military bases, Ukrainian negotiators said on Tuesday.

FALLOUT FROM 2021 CERB HACK CONTINUES TO AFFECT TAXPAYERS, CRA

G&M - Patrick Brethour (2022-03-29)

Chris Chezepock had the nasty shock last year of finding out he was one of the thousands of taxpayers whose online accounts with the Canada Revenue Agency had been accessed by hackers looking to fraudulently obtain pandemic benefits.

THE BANK OF CANADA WILL ALMOST CERTAINLY TAKE THE STEEPER PATH TO HIGHER RATES NEXT MONTH

FP - Kevin Carmichael (2022-03-29)

Higher interest rates won’t guarantee rain on the Prairies this summer, and Macklem has no influence over international oil prices. Bay Street economist David Rosenberg’s argument that central banks are about to trigger a recession is a good one. Alas, if you’re Macklem, and your primary job is keeping year-over-year increases in the consumer price index at about two per cent, the most recent set of data leave you with only one choice: reel faster.

BOC IS SUDDENLY ABLE TO TACKLE INFLATION AFTER WE EXPLAIN TO PARLIAMENT WHAT THEY DID

Better Dwelling - Stephen Punwasi (2022-03-29)

Supply chain issues exist, but not to the extent they’re making them out to be — especially before Ukraine. As we explained last week, this isn’t a regular amount of demand failing to be met. This is excess demand for goods, far more than normal supply levels satisfy. The increased demand is the intended consequence of loose monetary policy. The BoC actively tried to create demand that outran supply, to create more inflation. 

BANK OF CANADA EXPECTED TO BEGIN DOUBLING RATE HIKES NEXT MONTH, REVERSE QE

Better Dwelling - Daniel Wong (2022-03-29)

The BoC estimates 1.75% is the low range of the neutral policy rate, which will be hit within months. A neutral policy rate is the point where monetary policy provides no influence. Below the neutral is expansionary, meaning stimulus for economic growth. Above the neutral rate is when monetary policy slows growth. The BoC estimates the neutral range to be between 1.75% and 2.75%, with more forecasts now predicting the higher end of the range will be needed.

CLEVELAND FED FINDS SOME DATA UNDERSTATE INFLATION TREND

WSJ - Michael S. Derby (2022-03-28)

Underlying levels of inflation haven’t been as moderate as some recent Federal Reserve data have shown.

FEDERAL DEFICIT WAS $75.3 BILLION FOR FIRST NINE MONTHS

Investment Executive - CP (2022-03-28)

The federal government posted a budgetary deficit of $75.3 billion for the April-to-January period of its 2021-22 fiscal year.

CANADA 'FAIRLY CLOSE' TO A DEBT CRISIS, WARNS MAGNA FOUNDER FRANK STRONACH

FP - Staff (2022-03-25)

The Magna International Inc founder was speaking on BNN Bloomberg Wednesday after writing an op-ed for the National Post this week.

BESIDES CHINA, PUTIN HAS ANOTHER POTENTIAL DE-DOLLARIZATION PARTNER IN ASIA

Council on Foreign Relations - Zonhyuan Zoe Liu (2022-03-25)

An unintended consequence of Western punitive sanctions could be strengthening a Russia-China de-dollarization partnership. Joining such a partnership may also appeal to India. India has reportedly expressed interest in jointly exploring with Russia and China an alternative to SWIFT that would allow it to trade with countries under U.S. sanctions. 

RUSSIA BONDS RISE, DEFAULT RISK TUMBLES AS PAYMENT SENT TO CITI

Yahoo Finance - Giulia Morpurgo, Laura Benitez and Lyubov Pronina (2022-03-18)

JPMorgan Chase & Co. has processed the funds and sent the money on to Citigroup Inc., the people said, spurring optimism that the bonds may still be settled in dollars. Bondholders, however, are still waiting for the $117 million payment. Four investors in Europe and three in Hong Kong had yet to receive funds as of 9 a.m. in London. S&P Global Ratings warned that the “technical difficulties” in getting the money to investors was increasing the risk of a default -- either this time around or in the future.

BOC TAKES ANOTHER STEP IN DIGITAL CURRENCY RESEARCH, PARTNERING WITH MIT

Investment Executive - Daniel Calabretta (2022-03-18)

In 2020, the BoC published a background note about its official position on a CBDC pertaining to public policy, design, technology and risk management issues the central bank was considering as it builds out its capacity to issue a digital currency if the need arises.

TRUDEAU’S FINANCE CHIEF HAS MORE ROOM TO SPEND IN APRIL BUDGET

Bloomberg - Theophilos Argitis (2022-03-17)

Revenue could surpass projections by as much as C$30 billion ($23.6 billion) over the next two years, though the governing Liberals are likely to book a more conservative amount given extreme levels of uncertainty and volatility as a result of Russia’s war in Ukraine. 

THE FED’S FIREFIGHT WITH INFLATION FINALLY BEGINS: MORNING BRIEF

Yahoo Finance - Brian Cheung (2022-03-16)

The Fed’s next steps after today’s initial bump will be critical. With inflation clearly not “transitory,” the Fed may have to lean on some 0.50% hikes (that hasn’t happened since 2000) and a reduction in its $9 trillion balance sheet (that’s never been attempted at this scale) if price increases get even worse.

THE $140 BILLION QUESTION: CAN RUSSIA SELL ITS HUGE GOLD PILE?

Bloomberg - Eddie Spence (2022-03-16)

Bank of Russia expanded its gold reserves almost sixfold since the mid-2000s, creating the world’s fifth-biggest stockpile that’s valued at about $140 billion. It’s the type of asset it could sell to shore up the ruble, which has plunged as global economies isolate Russia following its invasion of Ukraine.

THE PRICE OF BIDEN’S EXCUSES FOR INFLATION KEEPS RISING

WSJ - Gerald Baker (2022-03-16)

‘Make no mistake, inflation is largely the fault of Putin.”

SAUDI ARABIA CONSIDERS ACCEPTING YUAN INSTEAD OF DOLLARS FOR CHINESE OIL SALES

WSJ - Summer Said (2022-03-16)

Saudi Arabia is in active talks with Beijing to price some of its oil sales to China in yuan, people familiar with the matter said, a move that would dent the U.S. dollar’s dominance of the global petroleum market and mark another shift by the world’s top crude exporter toward Asia.

WHAT WOULD A RUSSIAN BOND DEFAULT MEAN?

Investment Executive - AP (2022-03-16)

So Russia has the money to pay but says it can’t because of the sanctions that have restricted banks and frozen much of its foreign currency reserves. Ratings agencies have downgraded Russia’s credit rating to below investment grade, or “junk.” Fitch rates Russia “C,” meaning in Fitch’s view “a sovereign default is imminent.”

THE HUMBLING OF THE FEDERAL RESERVE

WSJ - Staff (2022-03-15)

The Federal Open Market Committee meets Tuesday and Wednesday, as it seeks to address the worst inflation in 40 years amid new risks to economic growth. Whatever the Fed decides on interest rates, it’s worth recalling how the central bank arrived at this unhappy moment.

WHITE HOUSE LAYS OUT GROUND RULES FOR DIGITAL ASSETS

Finextra - Finextra (2022-03-10)

The Order lays out a national policy for digital assets across six key priorities: consumer and investor protection; financial stability; illicit finance; US leadership in the global financial system and economic competitiveness; financial inclusion; and responsible innovation.

RATE HIKES WILL HIT CANADA’S KEY GROWTH ENGINE HARDEST. WILL OTHER SECTORS PICK UP THE SLACK?

G&M - DAVID PARKINSON (2022-03-08)

The day after the Bank of Canada raised its policy interest rate off its pandemic-emergency floor, the central bank’s Governor, Tiff Macklem, faced down worried questions about the strains rising borrowing costs were about to place on the backs of Canadians.

BANK OF CANADA GOVERNOR TIFF MACKLEM WARNS OF BROADENING INFLATION, SIGNALS AGGRESSIVE RATE HIKE PATH

G&M - Mark Rendell (2022-03-04)

Bank of Canada Governor Tiff Macklem said the central bank could be aggressive in pushing up borrowing costs this year, as inflationary pressures broaden and commodity prices move sharply higher in response to Russia’s invasion of Ukraine.

ECB LEARNS A LESSON ON HOW TO RUN A BOND MARKET

Bloomberg - Marcus Ashworth (2022-03-04)

The rate of change in financial markets has accelerated since Russia invaded Ukraine. With the market plumbing thus far proving sufficiently robust to accommodate wilder price swings accompanying risk transfers, even the relatively humdrum world of government debt is having to adapt. Specifically, the euro zone’s guardians of monetary stability, led by the European Central Bank, are having to intervene to reduce friction in their capital markets. It should be a wake-up call that liquidity can’t be taken for granted. 

BANK OF CANADA RAISES INTEREST RATE TO 0.5 PER CENT, PUSHING BORROWING COSTS UP FOR FIRST TIME SINCE 2018

G&M - Mark Rendell (2022-03-03)

The Bank of Canada has raised its policy interest rate, pushing up borrowing costs for the first time since 2018 and kicking off a series of rate hikes despite heightened economic uncertainty caused by Russia’s invasion of Ukraine.

POWELL BACKS 25-BASIS-POINT INTEREST RATE HIKE THIS MONTH, SAYS FED READY TO BE MORE AGGRESSIVE

G&M - HOWARD SCHNEIDER AND LINDSAY DUNSMUIR (2022-03-02)

Federal Reserve Chair Jerome Powell said on Wednesday he would support a 25-basis-point interest rate hike at the U.S. central bank’s March 15-16 policy meeting and would be “prepared to move more aggressively” if inflation does not abate as fast as expected.

RUSSIA TO TEMPORARILY BAN FOREIGNERS FROM SELLING ASSETS

Staff - Staff (2022-03-01)

"In the current sanction situation foreign entrepreneurs are forced to be guided, not by economic factors, but to make decisions under political pressure," Prime Minister Mikhail Mishustin told a governmental meeting.

RUSSIA-UKRAINE WAR IS 'A FINANCIAL WAR NOW'

Yahoo Finance - Brian Sozzi (2022-02-28)

Russia's central bank reserves have effectively been frozen amid the decision, notes Reid. The country had about $630 billion of foreign reserves, a majority of which likely resides directly with G10 banks and central banks, says Reid.

HOSTILITY TO RESOURCES COMES HOME TO ROOST AT TRANS MOUNTAIN

FP - Joe Oliver (2022-02-28)

Last week, as the world watched police restore public order in downtown Ottawa, the federal government’s hostility to resource development was dealt a huge financial blow that may in the end land-lock Canada’s immense oil reserves. Trans Mountain Corp. (TMC) announced that total costs for its pipeline expansion have ballooned 70 per cent to an eye-watering $21.4 billion, up from the latest estimate of $12.6 billion, and almost triple the initial estimate $7.4 billion. And, no surprise, the project’s projected completion was extended to the third quarter of 2023.

BIGGEST RUSSIAN BANKS COULD BE TARGETED AS WEST PREPARES SEVERE SANCTIONS OVER UKRAINE INVASION

FP - Owen Walker in London and Max Seddon in Moscow (2022-02-25)

The sanctions already put in place over the past week took aim at smaller banks, a handful of oligarchs, the Nord Stream 2 gas pipeline and the trading of Russia’s sovereign debt. But experts say that to really squeeze Putin, the West needs to take aim at the country’s biggest banks.

POZSAR SAYS $300 BILLION RUSSIA CASH PILE CAN ROIL MONEY MARKETS

Bloomberg - Garfield Clinton Reynolds (2022-02-25)

Russia still has about $300 billion of foreign currency held offshore -- enough to disrupt money markets if it’s frozen by sanctions or moved suddenly to avoid them.

CENTRAL BANKS UNLIKELY TO CHANGE COURSE ON RATE HIKES DUE TO UKRAINE CONFLICT

Better Dwelling - Stephen Punwasi (2022-02-25)

The BoC is still forecast to hike interest rates next week, possibly with more reason. BMO reiterated they expect a full (25 bps) hike to the overnight rate at the March 2 meeting. At this time, the bank doesn’t see the crisis spilling over beyond Ukraine. If that occurs, it might need to be reviewed. The risk of uncertainty means the unlikely scenario of a 50 bps hike in Canada can be safely “put to bed.”

CHRYSTIA FREELAND, MINISTER OF EVERYTHING, HAS BIG PLANS FOR CANADA’S ECONOMIC FUTURE

G&M - Trevor Cole (2022-02-24)

Housing The federal government has an important role to play, working with municipalities and provinces, in increasing supply, including a mix of rental supply. I think now is the time for new energy in the building of co-ops. We also need to do things in terms of the financialization of housing. We need to see housing as homes for Canadian families and not a financial asset. I want to be very clear that our government has absolutely no intention of altering the position on capital gains on the principal residence of Canadians. That is a very important part of how Canadian society works. Where we need to be thoughtful is in foreign money flowing into Canadian housing and turning that into a financial asset. That’s not what Canadian houses are meant to be for.

OSC FLAGS EMERGENCIES ACT TWEETS BY KRAKEN, COINBASE CEOS TO RCMP

FP - Claire Brownell (2022-02-24)

Kristen Rose, the OSC’s manager of public affairs, said the regulator is “aware” of posts earlier this week from the Twitter accounts of Kraken CEO Jesse Powell and Coinbase CEO Brian Armstrong, which criticized the invocation of the Emergencies Act and advocated for the importance of non-custodial crypto wallets, with Armstrong promoting his own company’s such product. Non-custodial wallets are controlled directly by an individual rather than by a third party such as a cryptocurrency-trading platform, making it more difficult for law enforcement to freeze or seize the funds they hold.

CANADA’S OLDEST BANK SEES MUCH HIGHER INFLATION AS COMMODITY PRICES RISE

Better Dwelling - Daniel Wong (2022-02-23)

The CPI forecast is climbing more aggressively than the BoC expects. The central bank last forecast 4.2% annual growth for 2022, up from their previous forecast of  3.2% growth. Independent expectations are rising very quickly, as fewer people see monetary policy moving fast enough to cool inflation. 

JPMORGAN NOW EXPECTS NINE STRAIGHT FED RATE INCREASES UNTIL MARCH 2023

Yahoo Finance - Evie Liu (2022-02-21)

Bank's economists warn of "a feedback loop taking hold between strong growth, cost pressures, and private sector behavior."

FINANCIAL INSTITUTIONS HAVE STARTED FREEZING PROTESTERS’ BANK ACCOUNTS BASED ON RCMP INFORMATION, CHRYSTIA FREELAND SAYS

G&M - James Bradshaw, Bill Curry (2022-02-18)

Deputy Prime Minister Chrystia Freeland said financial institutions have started freezing bank accounts belonging to protesters involved in blockades based on information from the RCMP, and predicted the number of accounts being targeted will rise in the coming days.

BANKS GET OTTAWA PROTESTERS' NAMES AS FINANCIAL CRACKDOWN GETS UNDERWAY

FP - Kevin Orland and Brian Platt (2022-02-18)

The Canadian Bankers Association confirmed the Royal Canadian Mounted Police has provided a list to the banks. The banks are still seeking clarity from law enforcement on how to handle the alleged protesters’ accounts, according to people familiar with the matter. But Finance Minister Chrystia Freeland said some accounts have already been frozen.

CANADIAN INFLATION PRESSURE IS BROADENING ACROSS CATEGORIES AS IT HITS 3 DECADE HIGH

Better Dwelling - Daniel Wong (2022-02-17)

Canadian inflation didn’t hear your transitory call apparently — it’s widening to other categories. Statistics Canada (Stat Can) data shows the consumer price index (CPI) soared in January. The annual growth rate reached 5.1% for the month, advancing from 4.8% a month before. Canada’s inflation hasn’t grown this fast since September 1991, three decades ago. To make things worse, high inflation is being felt across categories, making it harder to slow down.

NAVIGATING UNCHARTED TERRITORY

BOC - Timothy Lane (2022-02-16)

Deputy Governor Tim Lane discusses how the Bank of Canada approached decision making during the unprecedented upheaval brought on by the COVID‑19 pandemic.

WHAT IS CANADA’S FEDERAL EMERGENCIES ACT? A SUMMARY OF THE LAW’S POWERS AND USES

G&M - ABIGALE SUBDHAN AND SAMANTHA EDWARDS (2022-02-15)

On Feb. 14, Prime Minister Justin Trudeau announced the federal government is invoking the Emergencies Act to address the blockades taking place to protest pandemic restrictions, the first time the act has been triggered in Canada.

FED OFFICIALS AGREE ON A MARCH RATE HIKE BUT LITTLE ELSE

Investment Executive - Christopher Rugaber (2022-02-15)

James Bullard, president of the Federal Reserve Bank of St. Louis, on Monday reiterated his call for the Fed to take the aggressive step of raising its benchmark short-term rate by a full percentage point by July 1. Esther George, president of the Kansas City Fed, expressed support for a more “gradual” approach. And Mary Daly of the San Francisco Fed declined to commit herself to more than a modest rate hike next month.

BANKS GET EMERGENCY POWERS TO FREEZE ACCOUNTS, HALT FUNDS

G&M - James Bradshaw (2022-02-14)

Federal emergency act measures will expand the powers of Canada’s banks and financial intelligence agency to monitor and stem the flow of funds to protesters who have blocked downtown Ottawa and key corridors, as the federal government escalates its efforts to end the disruptions.

RAGING INFLATION FLIPS CURRENCY WARS INTO A RACE TO THE TOP

FP - Payne Lubbers (2022-02-11)

The way these battles conventionally work is this: a country tries to weaken its currency, to give it an advantage in global trade. It’s what President Donald Trump threatened to do with China, which he accused of intentionally devaluing the yuan.

RAGING INFLATION FLIPS CURRENCY WARS INTO A RACE TO THE TOP

FP - Payne Lubbers (2022-02-10)

But soaring inflation has changed priorities, since a stronger currency tends to help contain inflation by making imported goods cheaper. Strategists at TD Securities discussed the issue in a Wednesday note titled “Currency Wars in Reverse Got Markets in a Tizzy,” arguing that policy-makers now prefer strength because of the “inflationary impulse that has gripped markets over the past few quarters,” they wrote.

AT THE OLYMPICS, CHINA’S DIGITAL YUAN IS OFF TO A LESS-THAN-GOLDEN START

G&M - James Griffith (2022-02-08)

For 36 years, Visa has paid hundreds of millions of dollars to be an Olympic sponsor, ensuring its branding is all over stadiums and athletes, and that no one attending or watching the Games even thinks of Mastercard.

BANK OF AMERICA STRATEGISTS WARN FED HIKES IN PRICEY MARKET TO END POORLY

Yahoo Finance - Nikos Chrysoloras (2022-02-08)

While U.S. equities saw positive returns during previous periods of rate increases, the key risk this time round is that the Federal Reserve will be “tightening into an overvalued market,” the strategists led by Savita Subramanian wrote in a note.

FED JOINS CENTRAL BANKS AROUND THE WORLD IN RACE TO RAISE RATES

Yahoo Finance - Brian Cheung (2022-02-08)

“The Fed is no longer on the dovish end of the spectrum, but it is not very hawkish relative to its G10 counterparts either,” wrote BofA Securities’ economics team over the weekend.

GOODBYE EASY MONEY AS HAWKISH CENTRAL BANKS SPEED UP RATE HIKES

Bloomberg - Simon Kennedy (2022-02-07)

Two years after the pandemic sent the global economy into a deep but short recession, central bankers are withdrawing their emergency support -- and they’re moving faster than they or most investors had foreseen.

CANDICE BERGEN VOTED INTERIM CONSERVATIVE LEADER AFTER CAUCUS OUSTS O'TOOLE

CBC - John Paul Tasker, Nick Boisvert (2022-02-03)

Candice Bergen was voted interim leader of the Conservatives on Wednesday evening after a majority of party MPs voted to remove Erin O'Toole as leader earlier in the day.

BANK OF CANADA GOVERNOR SAYS IT'S UNCLEAR HOW QUICKLY INFLATION WILL DROP

FP - Reuters (2022-02-03)

Macklem, speaking to the Senate banking committee, reiterated that interest rates would have to start going up this year to tackle inflation, which is currently 4.8 per cent, more than double the central bank’s 2 per cent target.

DON'T MAKE REGULATORS CHEERLEADERS FOR FINANCE, UK CAMPAIGN GROUPS SAY

Reuters - Huw Jones (2022-02-03)

Britain must ditch plans to make regulators "cheerleaders" for global finance and instead focus on promoting financial inclusion at home, consumer campaign groups said on Friday.

THE BANK OF CANADA IS ON THE CUSP OF SHEDDING BONDS FROM ITS BALANCE SHEET

G&M - DAVID PARKINSON (2022-02-01)

The Bank of Canada’s maiden voyage into quantitative easing is coming to an end. Now we’re about to find out what the return trip – quantitative tightening – looks like.

BANK OF CANADA’S GOVERNOR TIFF MACKLEM WOULD LIKE YOU TO KNOW THAT HE DOESN’T LIKE INFLATION

G&M - Mark Rendell (2022-01-31)

The Governor of the Bank of Canada spent the best part of two years promising to keep interest rates as low as they could go, even in the face of surging inflation. This week, he blinked, declaring an end to the emergency phase of monetary policy, and putting Canadians on notice that borrowing costs are going up, and soon.

BOE HAS MORE THAN RATE HIKES TO WORRY ABOUT

Bloomberg - Marcus Ashworth (2022-01-31)

In 2016, the Bank of England took a stab at estimating the interest-rate equivalent of its bond-buying program: The thinking then was that 60 billion pounds ($80 billion) of asset purchases were comparable to a Bank Rate cut of about 50 basis points.

EIGHT-MONTH DEFICIT: FEDS SPENT $73.7 BILLION MORE THAN THEY TOOK IN

Investment Executive - CP (2022-01-31)

The federal government ran a budget deficit of $73.7 billion for the April to November period of the current fiscal year.

DON’T MISREAD THE BANK OF CANADA’S DECISION AS INACTION. INTEREST RATES WILL RISE, AND QUICKLY

G&M - DAVID PARKINSON (2022-01-27)

First, the obvious: The bank came right out and said that it plans to raise rates very soon – and that Wednesday’s announcement was, basically, clearing the tracks in preparation. This isn’t something central banks typically do. In this case, Bank of Canada Governor Tiff Macklem underlined the point in his post-announcement news conference. He wanted to make sure no one missed it. The bluntness had a certain “don’t say we didn’t warn you” feel to it.

BOC HOLDS RATES, BUT RISING PATH STILL IN PLAY

FP - Larysa Harapyn (2022-01-27)

Josh Nye, Senior Economist with RBC, talks with Financial Post’s Larysa Harapyn about the Bank of Canada’s decision to hold on interest rates, but signaled increases are coming.

BANK OF CANADA SEEN AS BEHIND THE CURVE AFTER RATE SURPRISE

Bloomberg - Erik Hertzberg and Theophilos Argitis (2022-01-27)

His own analysts presented him with evidence the economy is on the cusp of overheating and made a clear-cut economic case to hike immediately. But Macklem had told Canadians and investors they’d get a heads up before increasing rates. A move Wednesday could have been seen as a betrayal of that promise.

THE BANK OF CANADA DIDN’T RAISE RATES, IT RAISED ITS INFLATION FORECAST

Better Dwelling - Stephen Punwasi (2022-01-27)

Instead of raising rates to cool inflation, Canada’s central bank raised its inflation forecast. The BoC CPI estimate reached 4.2% for 2022, which is a notable jump from the 3.4% previously expected. It’s also more than double the target rate of 2% they should have been working towards. The central bank recently found out most businesses no longer believe the BoC can control the monetary supply. This presents a significant concern when attracting investment to Canada.

TRUDEAU FOE WOOS GOVERNORS TO HELP UNDO TRUCKER SHOT RULE

Bloomberg - Jen Skerritt, Kim Chipman, and Allison Smith (2022-01-26)

Alberta Premier Jason Kenney said he’s working with U.S. governors to lobby President Joe Biden and Canadian Prime Minister Justin Trudeau for an end to trucker vaccine mandates that are disrupting shipments across the border.

HOW HIGH WILL THE BANK OF CANADA HIKE RATES? WE ASKED THE COUNTRY’S TOP EXPERTS

Better Dwelling (2022-01-26)

A “dot plot” of forecasts for the Bank of Canada overnight rate after each rate announcement, demonstrating sentiment distribution. 

BANK OF CANADA MAINTAINS POLICY RATE, REMOVES EXCEPTIONAL FORWARD GUIDANCE

BOC - BOC (2022-01-26)

The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ %, with the Bank Rate at ½ % and the deposit rate at ¼ %. With overall economic slack now absorbed, the Bank has removed its exceptional forward guidance on its policy interest rate. The Bank is continuing its reinvestment phase, keeping its overall holdings of Government of Canada bonds roughly constant.

STIMULATING THE ECONOMY WAS EASY. TAMING INFLATION WILL BE MUCH TRICKIER.

G&M - KONRAD YAKABUSKI (2022-01-24)

If you’ve been in the market for a new refrigerator in recent weeks, you’re likely still suffering from sticker shock. Fridge prices were up almost 14 per cent in December, as Canada’s overall inflation rate hit a 30-year high of 4.8 per cent. Everything is suddenly costing more, from that fridge and the groceries you put in it (up 5.7 per cent) to a new car (7.2 per cent more) and the gas (33 per cent) it likely runs on. From home insurance (9.3 per cent) to shelter costs (5.4 per cent), Canadians are forking out more and more of their income just to cover the basics.

EU SHOULD BAN ENERGY-INTENSIVE MODE OF CRYPTO MINING, REGULATOR SAYS

FP - Eva Szalay (2022-01-24)

Thedéen said that European regulators should consider banning a mining method known as “proof of work” and instead nudge the industry towards the less energy-intensive “proof of stake” model to cut down on the sector’s vast power usage.

DEBT-STRAPPED CANADIANS BRACE FOR A RISKY RATE-HIKING CYCLE

Bloomberg - Theophilos Argitis and Erik Hertzberg (2022-01-24)

As early as next week, the Bank of Canada will start a campaign of tighter monetary policy that will test the country’s debt-laden consumers and reveal whether its robust economic recovery has staying power.

CENTRAL BANKS FACE A MOMENT OF TRUTH ON CRYPTO

Bloomberg - Lionel Laurent (2022-01-20)

The head of the Bank for International Settlements, Agustin Carstens, recently set out a dark vision for our financial future, quoting Goethe’s “Faust” and claiming that the “soul” of money was at stake.

ECB HAS EVERY REASON NOT TO ACT AS QUICKLY AS FED, LAGARDE SAYS

Bloomberg - Alexander Weber and William Horobin (2022-01-20)

“We’re all in very different situations,” Lagarde told the France Inter radio station Thursday in an interview. Inflation is “clearly weaker” in the euro area, while the region’s economic recovery is also not as advanced as in the U.S., she said. 

UKRAINE’S PRESIDENT REBUKES BIDEN FOR SUGGESTION OF ‘MINOR’ RUSSIAN ATTACK

FT - Guy Chazan, Roman Olearchyk, James Politi (2022-01-20)

Ukraine’s president Volodymyr Zelensky has hit back at Joe Biden’s suggestion that a “minor incursion” by Russian forces into Ukraine might not prompt the severe response the west has threatened — a remark that has alarmed allies of the US.

FED OPENS DEBATE OVER POSSIBLE DIGITAL CURRENCY

FT - James Politi and Colby Smith (2022-01-20)

After months of anticipation, the Fed on Thursday released a lengthy discussion paper that will serve as the basis of what is expected to be a heated and consequential debate at the heart of the central bank in the coming months — though it made clear it did not “favour any policy outcome” at this point.

CENTRAL BANKS MUST REDUCE THEIR BALANCE SHEETS MORE AGGRESSIVELY

FT - Kristin Forbes (2022-01-20)

Central banks do not hesitate to expand their balance sheets when a crisis hits.

WHY IS IT CANADA'S 'DUTY' TO DESTROY ITS ECONOMY AND CONFEDERATION IN THE PURSUIT OF NET ZERO?

National Post - Rex Murphy (2022-01-20)

A subsidiary question is: Does the government of a Confederation have the right, the legislative competence to declare the central industry of one of the provinces within that Confederation outmoded? And on that premise make it a national policy to destroy the economic well-being of that province?

MAKING BANK AND RIDING THE BUS: WHAT CANADIAN PRIME MINISTERS GET UP TO AFTER RETIREMENT

National Post - Tristin Hopper (2022-01-20)

In 2017, Joe Clark made an appearance in Atlanta alongside former U.S. President Jimmy Carter. It was a fitting meeting, as both men were cursed to spend the majority of their lives recovering from a brief and ultimately unsuccessful flirtation with absolute power. It’s now been 43 years since Clark’s nine-month stay in government — easily granting Clark Canadian history’s longest tenure as an ex-prime minister.

OVER 1 IN 5 CANADIAN DOLLARS CREATED DIDN’T EXIST TWO YEARS AGO

Better Dwelling - Stephen Punwasi (2022-01-19)

Canada’s central bank has been going Brrr, and it’s not because of the frigid winters in Ottawa. Bank of Canada (BoC) data shows that the money supply is still expanding rapidly in October. The M2++ money supply hit peak annual growth last year, reaching the highest level since the 1980s. The latest numbers show over 1 in 5 Canadian dollars today, didn’t exist prior to 2020. Traditionally the expansion of the money supply precedes inflation. That explains a lot.

ECONOMISTS SAY BANK OF CANADA TO BEGIN HIKING RATES NEXT WEEK

Bloomberg - Erik Hertzberg (2022-01-18)

Economists at TD Securities and Laurentian Bank said Monday the Bank of Canada will start a hiking cycle at its policy decision on Jan. 26. Bank of Montreal brought forward its call on the first increase to March from April, while Bank of Nova Scotia said the central bank “cannot afford” to wait any longer. 

BANK OF CANADA POLICY IS “TOO LOOSE,” RATE HIKES WILL REDUCE REAL ESTATE FROTH: BMO

Better Dwelling - Daniel Wong (2022-01-18)

Canada’s central bank has been tight-lipped about its next moves. The Bank of Canada last told the public that April would be the earliest they’ll be raising rates. That was back when they said inflation was transitory though. Since then, the US has dismissed the transitory narrative and Canada’s central bank has been quiet.

FINANCIAL SECTOR FACES CLIMATE TRANSITION RISK, SAYS BOC AND BANKING REGULATOR

G&M - MARK RENDELL AND JEFFREY JONES (2022-01-17)

Canada’s long-term economic growth and the stability of its financial system could be put at risk if the country delays implementing policies to deal with the transition to a low-carbon world, the central bank and the banking regulator say in a report analyzing a range of possible climate scenarios.

The Bank of Canada and the Office of the Superintendent of Financial Institutions examined the balance sheets of Royal Bank of Canada 

TRADERS FACE RISKS WITH BETS BANK OF CANADA WILL OUTDO FED ON HIKES

Bloomberg - Payne Lubbers and Edward Bolingbroke (2022-01-14)

Traders have boosted expectations for the pace of central bank rate hikes in Canada even more than in the U.S., provoking questions about whether the market might have gone too far, too fast.

WHY CENTRAL BANKS ARE KEY TO GLOBAL ECONOMIES IN 2022

Bloomberg - Video (2022-01-14)

As the coronavirus pandemic rages on for a third year, Bloomberg’s Stephanie Flanders explains on “Quicktake Stock” why Covid-19 will take a back seat to central banks as a driver for global economies this year.

USING SCENARIO ANALYSIS TO ASSESS CLIMATE TRANSITION RISK

OSFI - OSFI (2022-01-14)

The Bank of Canada and the Office of the Superintendent of Financial Institutions (OSFI) completed their climate scenario analysis pilot in collaboration with six Canadian federally regulated financial institutions. 

POWELL MAKES CASE FOR FED CURBING INFLATION WHILE DOING NO HARM

Bloomberg - Rich Miller and Craig Torres (2022-01-12)

Federal Reserve Chair Jerome Powell sought to reassure lawmakers and investors on Tuesday that the central bank can pull off the tricky task of bringing down four-decade high inflation without damaging the U.S. economy.

THE GREENING OF THE FEDERAL RESERVE

WSJ - Editorial Board (2022-01-12)

Jerome Powell faced the Senate Banking Committee at his confirmation hearing for a second term at the Federal Reserve on Tuesday, and it’s a sign of the progressive times that a leading issue was the greening of the central bank. Not green as in money, but as in climate regulation.

FINAL REPORT OF THE BOC-OSFI CLIMATE SCENARIO ANALYSIS PILOT

BOC - BOC (2022-01-12)

On Friday, January 14, 2022, the Bank of Canada and the Office of the Superintendent of Financial Institutions (OSFI) will publish the Final Report of the BoC-OSFI Climate Scenario Analysis Pilot.

BANK REGULATOR MULLS HIGHER CAPITAL REQUIREMENTS FOR BANKS AS CUSHION AGAINST CLIMATE CHANGE RISKS

G&M - James Bradshaw (2022-01-11)

Canada’s banking regulator could raise capital requirements for banks in the coming years to build up new buffers against risks from climate change and the challenging transition to a greener economy.

Peter Routledge, who leads the Office of the Superintendent of Financial Institutions (OSFI), said at a virtual conference held by Royal Bank of Canada on Wednesday that the regulator “will expect federally regulated financial institutions to build up their capital buffers in the 2020s.”

New capital buffers would be designed to guard against potentially higher volatility and risks to the financial sector as action to combat climate change ramps up, and especially if some of the tougher measures are put off past 2030.

After OSFI lifted those restrictions in November, with Mr. Routledge urging banks to “act responsibly” with their surplus capital, the six largest banks announced dividend increases of 10 per cent to 25 per cent, and plans to buy back 2 per cent to 3.5 per cent of their shares. And in late December, Bank of Montreal 

CANADA HAS COMMITTED TO HALT FINANCING TO THE OIL AND GAS INDUSTRY. TO UNDERSTAND WHAT THAT REALLY MEANS, WATCH FOR THE FINE PRINT

G&M - Matthew McClearn (2022-01-10)

Of all the recipients of Canadian government support in recent years, Petroleos Mexicanos (Pemex) ranks among the strangest. Export Development Canada, a Crown corporation, provided 19 loans to Mexico’s state-owned oil company over 15 years, totalling somewhere between $3-billion and $5.7-billion (EDC only discloses ranges, not precise amounts). The Indian Oil Company received somewhere between $190-million and $425-million. Petrobras, Brazil’s state-owned oil company, got at least $1-billion.

LATEST EMPLOYMENT NUMBERS POSITIVE, BUT ‘A LITTLE BIT STALE’

Investment Executive - Greg Mechbach (2022-01-10)

Canada’s unemployment rate was 5.9% in December, down from 6% in November and 7.1% in August, Statistics Canada reported Friday.

U.S. FEDERAL RESERVE MAY NEED TO HIKE RATES FASTER, REDUCE BALANCE SHEET QUICKLY, MINUTES SHOW

G&M - Howard Schneider (2022-01-06)

Federal Reserve officials said last month that the U.S. labour market was “very tight” and might need the U.S. central bank not just to raise interest rates sooner than expected but also reduce its overall asset holdings to tame high inflation, according to minutes of their Dec. 14-15 policy meeting.

FEDERAL DOCUMENTS HINT AT SWEEPING ECONOMIC IMPACT FROM CENTRAL BANK ‘DIGITAL LOONIE’

Investment Executive - Jordan Press (2022-01-05)

In one briefing note from last January, officials warned Finance Minister Chrystia Freeland that the issuance of a central bank digital currency would entail “wide-reaching implications for the economy, the financial system” and the Bank of Canada’s operations.

CPP PREMIUMS SET TO RISE IN JANUARY, A BIGGER JUMP THAN PLANNED

CBC - CP (2022-01-03)

The increase is part of a multi-year plan approved by provinces and the federal government five years ago to boost retirement benefits through the public plan by increasing contributions over time. The increases started in 2019.

A NEW YEAR AND NEW HIKE TO CPP PREMIUMS— THE LARGEST IN THREE DECADES — TO HIT CANADIANS

National Post - National Post (2022-01-02)

In the case of CPP, maximum contributions by employees and employers will be $3,499.80 in 2022, up from $3,166. For self-employed Canadians, the maximum amount will be $6,999, up from $6,332.

BANK OF CANADA’S MONETARY POLICY DIRECTION IN 2022 COULD DEPEND ON THE PUBLIC’S INFLATION EXPECTATIONS

G&M - Mark Rendell (2021-12-28)

Bank of Canada officials spent much of 2021 assuring people that this period of high inflation would be relatively short-lived. The shape of monetary policy next year could depend to a significant degree on whether Canadians continue to believe this narrative.

WHO WILL GET THE FED REGULATION JOB? HERE ARE SOME OF THE CONTENDERS

Reuters - Pete Schroeder and Michelle Price (2021-12-28)

Speculation over who will get the role is once again ramping up, after the Wall Street Journal on Tuesday reported that the White House was considering Sarah Bloom Raskin, a former Fed governor and former Treasury Department official, for the position.

CENTRAL BANKS HAVE BLINKED ON INFLATION, IN RACE TO AVERT THE SECOND ROUND

G&M - DAVID PARKINSON (2021-12-21)

Last week may go down as the moment the world’s central bankers lost their staring contest with inflation.

FEDERAL GOVERNMENT DEPOSITED NEARLY $26 MILLION IN THE WRONG BANK ACCOUNTS LAST YEAR

CBC - Elizabeth Thompson (2021-12-21)

The federal government deposited nearly $26 million into the wrong bank accounts during the last fiscal year — and more than $10 million of it may be gone for good.

BANK OF CANADA FILLS IN MANDATE BLANKS AMID INFLATION DISCOMFORT

Bloomberg - Shelly Hagan, Erik Hertzberg (2021-12-16)

Governor Tiff Macklem underscored that price stability is central to the Bank of Canada’s renewed mandate and indicated that any new flexibility will apply only at times when inflation is low or the economy is weak.

US FEDERAL RESERVE DOUBLES THE PACE OF TAPERING, RBC FORECASTS EARLIER RATE HIKES

Better Dwelling - Daniel Wong (2021-12-16)

The Fed held rates but will double the speed it tapers its bond-buying, a sign easy credit will come to an end. The Fed will lower its Treasury purchases by another US$20 billion next month. Mortgage backed securities purchases will also fall by US$10 billion. At this pace, the program should be over by mid-March. Before this announcement, RBC didn’t see the program ending until mid-2022.

OTTAWA’S ‘FISCAL GUARDRAILS’ ON DEBT LEVELS HAVE SUDDENLY GONE AWOL

G&M - Patrick Brethour (2021-12-15)

In November, 2020, Finance Minister Chrystia Freeland sidled past demands for a fiscal anchor, such as setting a target level for Canada’s debt burden, to limit the growth in the federal government’s spending and debt. Instead, she announced, the government would adopt “fiscal guardrails,” broader economic measures that would guide decisions on $100-billion of stimulus spending over three years.

FED SEEN DELIVERING ONE OF THE MOST HAWKISH PIVOTS IN YEARS

Bloomberg - Steve Matthews and Sarina Yoo (2021-12-15)

More than half predict the Fed’s quarterly forecasts, released after the conclusion of its two-day meeting Wednesday, will show the median of 18 officials projecting two rate hikes next year from current levels near zero.

THE PRICE OF THE FED’S DELAY

WSJ - Editorial Board (2021-12-15)

The Federal Open Market Committee (FOMC) is meeting this week, and its members were greeted Tuesday with the rude welcome of surging wholesale prices. This is more evidence that Chairman Jerome Powell and the Federal Reserve have made a historic mistake that they now have to fix without sending the economy into recession.

THE BOC IS WAITING FOR FULL EMPLOYMENT TO RAISE RATES. BANKS SAY CANADA IS PAST THAT

Better Dwelling - Daniel Wong (2021-12-15)

BMO chief economist Douglas Porter said, “mission accomplished” because they already hit full employment. His analysis shows prime-aged (15-64) workers’ employment rate is at a record high. The rate is “easily” past pre-pandemic levels. At the start of 2020, the Canadian economy was also considered robust. By no measure is this a weak employment market. 

FED TO ACCELERATE WITHDRAWAL OF ECONOMIC AID AS PRICES SURGE

Investment Executive - Christopher Rugaber (2021-12-15)

On Wednesday, the Fed will likely announce that it will reduce its monthly bond purchases at twice the rate that Powell had outlined just six weeks ago. Those bond purchases are intended to lower longer-term rates, so winding them down more quickly — likely by early spring — will lessen some of the economic aid the Fed supplied after the pandemic erupted last year.

BANK OF CANADA’S NEW MANDATE COMES WITH ONE WRINKLE: POLITICS

G&M - DAVID PARKINSON (2021-12-14)

The renewal of the Bank of Canada’s mandate agreement with the federal government grants the central bank a five-year licence to, largely, continue doing what it has already been doing.

MICHAEL SABIA WAS GREETED AS A GAME CHANGER AS CANADA’S DEPUTY FINANCE MINISTER. A YEAR LATER, HE HAS MADE LITTLE HEADWAY

G&M - Robert Fife, Steven Chase (2021-12-14)

Michael Sabia spent decades helming major Canadian companies before the Liberal government recruited him to be deputy minister of the federal Department of Finance in late 2020. He accepted the job, he said at the time, in order to drive an economic-growth agenda in Ottawa.

BANK OF CANADA RENEWS 2-PER-CENT INFLATION TARGET, EMPHASIZES MAXIMUM EMPLOYMENT

G&M - Mark Rendell (2021-12-14)

The federal government has directed the Bank of Canada to put more emphasis on full employment as it aims to keep inflation low and stable. It is the most significant change to the central bank’s mandate in three decades, and reflects evolving ideas about the nature of the economy and monetary policy.

'TRANSITORY' WAS THE WORST INFLATION CALL IN THE FEDERAL RESERVE'S HISTORY, SAYS MOHAMED EL-ERIAN

FP - Eric Martin (2021-12-14)

“The characterization of inflation as transitory — it’s probably the worst inflation call in the history of the Federal Reserve,” El-Erian said on CBS’s “Face the Nation” on Sunday.

JOINT STATEMENT ON CRYPTO-ASSET POLICY SPRINT INITIATIVE AND NEXT STEPS

RealVision - Office of the Comptroller of Currency (2021-12-13)

A wave of de-banking may be coming to crypto and fintech over the coming 12 months. Regulators conducted a series of interagency "policy sprints" focused on crypto assets. They recently issued a joint statement with a roadmap of the agencies' plans to clarify throughout 2022 whether certain activities are "legally permissible." Paul Atkins, CEO & Founder of Patomak Global Partners and former SEC Commissioner, joins Real Vision in this exclusive interview to break down what this letter could mean for the banking organizations. Interviewed by Maggie Lake on December 11, 2021. Check out the joint statement from the Federal Reserve, FDIC, and OCC here: https://bit.ly/3ytNTRF

A SWIFT ROUTE TO ECONOMIC RUIN

G&M - Eric Reguly (2021-12-12)

Thank God for financial globalization, the Americans must be thinking. The Russian financial system is no longer an island, as it was in the Soviet era. But it can effectively be turned back into one, just like that – by flicking a switch.

CHRYSTIA FREELAND TO ANNOUNCE BANK OF CANADA’S RENEWED MANDATE ON MONDAY

G&M - Mark Rendell (2021-12-12)

Finance Minister Chrystia Freeland will announce the Bank of Canada’s new mandate on Monday in a long-awaited decision that is expected to keep the central bank’s inflation target at 2 per cent while adding new language about how it should factor in employment when setting interest rates.

BRACE FOR IMPACT: RATE HIKES ARE COMING

G&M - William Robson (2021-12-12)

Bank of Canada governor Tiff Macklem, like U.S. Fed chairman Jerome Powell, is clearly starting to view continuing high inflation with concern. A change is coming in monetary policy. With demand outrunning supply, our central banks’ policy interest rates need to rise – and may rise a lot.

CHRYSTIA FREELAND EXPECTED TO RENEW BANK OF CANADA’S 2 PER CENT INFLATION TARGET

G&M - BILL CURRY AND MARK RENDELL (2021-12-10)

Economists expect Finance Minister Chrystia Freeland to renew the Bank of Canada’s mandate of aiming its monetary policy at keeping inflation around 2 per cent, and to add new guidance to consider employment levels when it makes its decisions, but stop short of a dual mandate.

BANK OF CANADA WORRIED SUPPLY CHAIN DISRUPTIONS WILL PERSIST, STOKING INFLATION FOR LONGER

FP - Shelly Hagan (2021-12-10)

While reiterating that officials expect these constraints to eventually ease along with inflation next year, Gravelle emphasized there’s a lot of uncertainty around that outlook. In January, the central bank will reassess whether bottlenecks and shortages are impacting the economy’s ability to grow without fuelling inflation.

BANK OF CANADA HOLDS ON INTEREST RATES, STILL SEES HIKES IN MIDDLE QUARTERS OF NEXT YEAR

G&M - Mark Rendell (2021-12-09)

The Bank of Canada left monetary policy unchanged Wednesday in a stand-pat interest-rate decision that highlighted stubbornly high inflation and accelerating wage growth while pointing to economic uncertainty tied to the Omicron variant of COVID-19.

A BIG BANK SENT TRADERS A CHRISTMAS POEM ABOUT THE BANK OF CANADA’S INACTION

Better Dwelling - Stephen Punwasi (2021-12-09)

The poem isn’t overly critical of Good Guv’nor Macklem but doesn’t portray him as a man of the public. It starts with ignoring the issues they’re meant to prioritize, such as inflation and input costs. Then celebrates the gains stocks made due to “printing” and ignoring that the market sees rates this low as irresponsible. Circumstances that are a tragedy for the working and middle class, but great for the rich.  

THE BANK OF CANADA HELD RATES AND DROPPED A FIB ABOUT BUYING GOVERNMENT BONDS

Better Dwelling - Stephen Punwasi (2021-12-09)

Canada’s central bank is holding rates, which shouldn’t have been a surprise. The BoC is keeping the 0.25% overnight rate and said they’ll continue executing its reinvestment plan. As of Nov 1, the BoC has promised to only buy Government of Canada (GoC) bonds to replace those rolling off its balance sheet. They said their holdings of GoC bonds are “roughly constant” this morning.

TIME FOR THE BANK OF CANADA TO MAKE A HARD CHOICE

FP - David Laidler (2021-12-08)

Consider the Bank of Canada, now caught in a trap of its own making. Its mandate, pending an imminent renewal, requires it to maintain inflation in a range around two per cent, but its “forward guidance,” issued incessantly for the past year, has promised to keep the overnight rate of interest at 0.25 per cent until the real economy has returned to “normal” — at a date that lately seems to have been creeping closer from its original value somewhere around the end of 2022. The Bank is stuck with two quantitative targets, one, an inflation target agreed with the government that is its ultimate policy goal, and the other, its own creation, its target for the overnight rate, which is its main policy instrument. And it doesn’t seem to have thought much about what to do if they proved incompatible, which they now have. So: how did the Bank get into this mess, and more important, how does it extract itself?
We shouldn’t criticise the authorities for rapid resort to strong and unconventional stimulus when COVID-19 struck last March. To continue with “inflation targeting as usual” in those circumstances would have been a bit like sticking to the rules of the Gold Standard in the summer of 1914. Nor should we really complain that the stimulus turned out to be a bit excessive — better too much than too little under the circumstances, surely? The Bank’s fault, which it has shared to varying degrees with the Fed, the European Central Bank and the Bank of England, lay in failing to appreciate sufficiently the inflationary risk inherent in its measures, and even more so, in issuing its forward interest-rate guidance with an unwarranted degree of certainty.

OSFI’S NEW GREEN GROUP A PLUS FOR CANADA

Investment Executive - James Langton (2021-12-07)

“We believe globally coordinated efforts on climate risk management help financial institutions understand the consequences of climate change for their business, support their efforts to develop important climate risk management capabilities and capitalize on opportunities presented by climate change,” it said.

AS IT EYES INFLATION, THE BANK OF CANADA MUST MIND THE FAST-CLOSING LABOUR GAP

G&M - DAVID PARKINSON (2021-12-06)

If you take your eyes off Canada’s rocket car of a labour market for a moment as it zooms up the recovery road, and look back far behind it, you’ll spot something petty important that it has left in its dust.

FREELAND TO RELEASE FALL FISCAL UPDATE JUST DAYS BEFORE BREAK

G&M - Bill Curry (2021-12-03)

Finance Minister Chrystia Freeland has set Dec. 14 as the release date for a fall fiscal update, which will be the first formal revision of the federal government’s economic forecast since the April budget.

WALL STREET ENDS LOWER AS TAPER ACCELERATION WORRIES PILE ONTO OMICRON ANGST

FP - Devik Jain (2021-12-01)

“The principal contributor to the decline in stock prices today is the Powell commentary, regarding the upcoming Fed meeting, about accelerating the tapering of their bond buying program, which obviously leads to the prospect that rate hikes come sooner next year,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.

LIRA CRASH SPURS FIRST CENTRAL BANK INTERVENTION SINCE 2014

Bloomberg - Onur Ant and Asli Kandemir (2021-12-01)

The monetary authority said in a statement that it took action due to “unhealthy price formations” in the lira, which has been in freefall since President Recep Tayyip Erdogan renewed his push for lower interest rates. 

FCA TO DOUBLE FEES CHARGED TO REGULATED FIRMS

Finextra - Finextra (2021-12-01)

The watchdog says the fee increase would better reflect the costs associated with the authorisation and supervision of 51,000 firms throughout the UK.

THE INDIGENOUS ECONOMY IN CANADA: PARTNERING TO PROMOTE

BOC - Lawrence Schembri (2021-12-01)

Role of BOC in inigenous economies described in power point.

FREELAND MUST TREAD CAREFULLY IN DEBATE ON BANK OF CANADA’S INFLATION MANDATE

G&M - DAVID PARKINSON (2021-11-30)

Or maybe Ms. Freeland was hinting that the government’s renewal of the Bank of Canada’s five-year mandate – the underlying principles that the bank applies when deciding on interest rates – will be a lot more this time around than the usual rubber-stamping of another five years of the bank’s long-standing 2-per-cent inflation target. Perhaps Ms. Freeland is prepared to step into the debate about the central bank’s monetary policy-setting framework in a way that no Canadian government has in decades.

FEDERAL DEFICIT HITS NEARLY $69B OVER FIRST HALF OF FISCAL YEAR

Investment Executive - CP (2021-11-29)

Program spending, excluding net actuarial losses, between April and September was $225 billion, a decline of about $83.9 billion, or 27.2% drop, from the $308.9 billion in the same period one year earlier.

TRUDEAU UNDER FIRE AFTER U.S. RAISES DUTY RATES ON CANADIAN SOFTWOOD PRODUCERS

G&M - Steven Chase, Brent Jang (2021-11-26)

Prime Minister Justin Trudeau’s government was criticized Thursday for its handling of Canadian-American relations in the wake of an announcement by the United States that it would double the rate of punitive duties on most softwood imports from Canada.

OPPOSITION GRILLS TRUDEAU ON INFLATION, HOUSING AS ECONOMIC ISSUES TOP PARLIAMENT AGENDA

G&M - MARIEKE WALSH AND MARK RENDELL (2021-11-25)

Mr. Trudeau was derided by Conservative Leader Erin O’Toole’s front bench on his grasp of the issues at stake for ordinary people, as deputy leader Candice Bergen challenged him to name the price of common goods such as bread and bacon and beans, and of surf boards – one of the Prime Minister’s favoured vacation activities.

LEADERSHIP SHAKE-UP TO TEST MEXICAN CENTRAL BANK AS INFLATION SOARS

Reuters - Anthony Esposito (2021-11-25)

Mexican President Andres Manuel Lopez Obrador's surprise shakeup of the nomination process for the Bank of Mexico's (Banxico) next chief has cast doubt over the bank's rate-tightening cycle as it battles to keep high inflation in check.

EMERGING PRUDENTIAL RISKS IN HOUSING

OSFI - Peter Routledge (2021-11-24)

Although the word “exuberant” characterizes the housing markets in many Canadian cities & towns since the fall of 2020, we at OSFI believe residential mortgage credit risk has risen only modestly. There remains a risk that residential mortgage credit conditions could deteriorate, but fortunately OSFI has leveraged several prudential tools to increase the margin of safety in that market. In this endeavour, our federal and provincial financial safety-net peers have contributed mightily. Nevertheless, we consider the current imbalance between housing demand and supply to be a material prudential risk, and all actors in the Canadian housing system must take actions if we are to lessen the risk.

REMARKS BY TIFF MACKLEM, GOVERNOR OF THE BANK OF CANADA, AND BY LAWRENCE SCHEMBRI, DEPUTY GOVERNOR

BOC - Tiff Macklem (2021-11-24)

On Monday, November 29, and Tuesday, November 30, 2021, the Bank of Canada will host the inaugural Symposium on Indigenous Economies, a joint conference of the Bank of Canada, the Tulo Centre of Indigenous Economics and the Reserve Bank of New Zealand. It is the first in a series of bi-annual events examining the unique economic issues facing Indigenous peoples. The Symposium seeks to build cultural awareness and foster inclusion, strengthen engagement with Indigenous communities and support economic and financial education for and about Indigenous people.

JAPANESE BANKS TO TEST DIGITAL CURRENCY

Finextra - Finextra (2021-11-24)

The digital currency will be backed by bank deposits and use a shared platform to accelerate fund transfers and settlement between companies. While there will be a shared platform, a separate "business process area" will mean that the currency can be programmed to meet different business needs of the participants.

BIDEN NOMINATES JEROME POWELL FOR A SECOND TERM AS FEDERAL RESERVE CHAIR

G&M - Christopher Rugaber (2021-11-22)

President Joe Biden announced Monday he’s nominating Jerome Powell for a second four-year term as Federal Reserve chair, endorsing Powell’s stewardship of the economy through a brutal pandemic recession in which the Fed’s ultralow rate policies helped bolster confidence and revitalize the job market.

POWELL, BRAINARD NOD TO INFLATION THREAT IN NOMINATION REMARKS

Reuters - Reuters (2021-11-22)

Federal Reserve Chair Jerome Powell and Fed Governor Lael Brainard on Monday both noted the corrosive impact high inflation is having on the U.S. economy and American families in what may be a signal that controlling the rapid pace of price increases is now the central bank's top priority.

JACK M. MINTZ: POLITICIANS BEWARE: DEFICITS EVENTUALLY BITE

FP - Jack M. Mintz (2021-11-19)

This is not as simple a matter as you might think. It depends on how deficits are dealt with in later years. When fiscal policy tightens, governments typically avoid raising taxes or cutting spending on the poor. If so, richer provinces like Alberta, Ontario and British Columbia will see a rise in transfers to other provinces. On the other hand, if the federal government splurges on policies that benefit the rich, such as electric cars or licensing restrictions, net transfers from wealthier provinces might well decline.

HOUSE SET TO APPROVE $2 TRILLION SOCIAL SPENDING AND CLIMATE BILL

WSJ - Andrew Duehren and Richard Rubin (2021-11-19)

The House was set to pass a roughly $2 trillion education, healthcare and climate package Friday, as Democrats corralled their slim majority to approve the centerpiece of President Biden’s economic agenda after months of wrangling.

CORPORATE DEBT ATTRACTS HEAVY FOREIGN INVESTMENT: STATSCAN

Investment Executive - James Langton (2021-11-19)

Through the first nine months of 2021, foreign investors bought $126.0-billion-worth of Canadian securities, up from $108.7 billion for the same period in 2020.

REMARKS BY NEVILLE HENDERSON - 2021 MORTGAGE INSURANCE AND P&C RISK MANAGEMENT SEMINAR

OSFI - Neville Henderson (2021-11-18)

COVID-19 has accelerated risks, which require accelerated responses to those risks from institutions and regulators. Even before the onset of the pandemic economic pressures due to extended period of low interest rates, uncertain and volatile business conditions, and growing exposures to non-financial risks were shaping the future of the insurance sector.

JAMEY HUBBS

OSFI - Superintendent Jamey Hubbs at the Canadian Regulatory Technology Association annual meeting (2021-11-18)

OSFI’s approach to digitalization is determined through our mandate. OSFI’s purpose as stated in the OSFI Act is “to ensure that financial institutions and pension plans are regulated by an office of the Government of Canada so as to contribute to public confidence in the Canadian financial system”. We see the potential to unlock greater value for Canadians who expect their regulators to temper, but not inhibit, innovations. Our approach is in finding that balance to foster financial stability and contribute to Canadians confidence in their financial system.

JPMORGAN ECONOMISTS NOW PREDICT FED TO RAISE RATES IN SEPTEMBER

Bloomberg - Simon Kennedy (2021-11-18)

JPMorgan Chase & Co. economists said they now expect the U.S. Federal Reserve to raise interest rates next September, becoming the latest on Wall Street to jettison a forecast for the central bank to stay on hold through 2022. 

BOC DEPUTY GOVERNOR HIGHLIGHTS LABOUR MARKET UNCERTAINTY, COMPLICATING RATE HIKE TIMING

G&M - Mark Rendell (2021-11-17)

The Bank of Canada is grappling with labour market uncertainty as it tries to gauge the health of Canada’s economic recovery and estimate a timeline for interest rate hikes in the face of surging inflation, deputy governor Lawrence Schembri said Tuesday.

HOW MUCH GREEN PAIN WILL CANADIANS TOLERATE?

FP - Joe Oliver (2021-11-17)

COP26, supposedly humanity’s “last best chance,” struggled to yield even faint hope of keeping temperatures from rising 2 C, let alone 1.5 C. Even so, egged on by catastrophists and the mainstream media, Canadian politicians are adopting increasingly damaging climate policies. Should we be surprised that Canada’s delegation to COP26 was the world’s largest? Surprised, not so much. Appalled, definitely.

UK INFLATION LEAPS TO 10-YEAR HIGH, BOLSTERING RATE HIKE BETS

Reuters - Andy Bruce and William Schomberg (2021-11-17)

British inflation surged to a 10-year high last month as household energy bills rocketed, according to data on Wednesday that will bolster expectations that the Bank of England will raise interest rates next month.

LIBERALS’ NEW BANK TAX COULD BE IMPLEMENTED BY START OF 2022

G&M - James Bradshaw (2021-11-15)

Canada’s major banks are expecting larger tax bills in 2022 as a new surcharge on financial institutions’ profits over $1-billion could be pushed through by Ottawa as soon as the start of 2022.

BANK OF CANADA LIKELY TO ADD LABOUR-MARKET CONDITIONS TO INFLATION MANDATE, CIBC SAYS

FP - Shelly Hagan (2021-11-15)

Avery Shenfeld, chief economist at the Canadian Imperial Bank of Commerce, said Friday that he expects to see new language around the idea that achieving the central bank’s two per cent inflation target sustainably requires an economy near full employment.

ARE CANADIAN HOUSEHOLDS READY FOR HIGHER RATES?

Youtube - Video (2021-11-12)

CIBC Deputy Chief Economist Benjamin Tal speaks with Financial Post’s Larysa Harapyn about whether Canadian households are ready for higher rates.

POWELL OR BRAINARD? BIDEN WEIGHS HIS PICK FOR U.S. FED CHAIR

Reuters - Jeff Mason (2021-11-11)

President Joe Biden is still weighing whether to keep Jerome Powell as chair of the Federal Reserve for a second term or elevate Fed Governor Lael Brainard to the post, an administration official said on Wednesday.

'IF IT AIN'T BROKE, DON'T FIX IT': BOC SHOULDN'T CHANGE POLICY FRAMEWORK, ANALYSTS SAY

FP - Julie Gordon (2021-11-10)

The inflation target renewal, done jointly with the federal government every five years, is due by year-end and comes at a time when central banks around the world are grappling with how to manage an uneven rebound from the COVID-19 pandemic.

‘BITCOIN IS NOT A DIGITAL CURRENCY, PEOPLE DON’T SPEND IT’, BANK OF CANADA GOVERNOR SAYS

Finbold - Justinas Baltrusaltis (2021-11-09)

Bank of Canada Governor Tiff Macklem has reiterated that Bitcoin cannot be classified as a currency because it lacks attributes to be used in transactions.

CENTRAL BANKS WALKING AN INCREASINGLY FINE LINE

Investment Executive - James Langton (2021-11-09)

“But if inflation continues to surprise to the upside and hiring proves sluggish, expect the Fed to field more questions about whether it can continue to hold rates low until maximum employment is achieved,” the bank added.

BANKS CLEARED TO RAISE DIVIDENDS, HIKE EXECUTIVE PAY AFTER OSFI LIFTS RESTRICTIONS

FP - Barbara Shecter (2021-11-08)

Peter Routledge, head of the Office of the Superintendent of Financial Institutions, said Thursday that the measures “are no longer necessary” and that decisions about capital distribution belong with boards of directors and management of the financial institutions.

FED TO START TAPERING ASSET BUYS BY $15 BILLION LATER THIS MONTH

FP - Craig Torres (2021-11-04)

After reductions in November and December, “the committee judges that similar reductions in the pace of net asset purchases will likely be appropriate each month, but it is prepared to adjust the pace of purchases if warranted by changes in the economic outlook,” the U.S. central bank’s policy-setting Federal Open Market Committee said in a statement Wednesday following a two-day meeting.

RESERVE BANK OF AUSTRALIA ABANDONS KEY STIMULUS TOOL

WSJ - Stuart Condie (2021-11-02)

The RBA said it would stop using yield caps and abandoned a view that its benchmark interest rate won’t rise until 2024, joining other central banks that are tightening policy as inflation risks mount.

THE BANK OF CANADA MAY NEED 8 RATE HIKES TO COMBAT INFLATION: SCOTIABANK

Better Dwelling - Better Dwelling (2021-11-02)

The bank’s economists are calling a very sharp climb for Canadian interest rates. They have forecast an increase of 100 basis points (bps) in the second half of 2022. It would be followed by another increase of 100 bps in 2023. An overnight rate of 2.25% would be the highest Canadians have seen since 2008. 

FEDERAL DEFICIT HITS $57 BILLION NEARING HALFWAY OF FISCAL YEAR

Investment Executive - CP (2021-11-01)

The federal government ran a deficit of more than $57 billion over the first five months of its fiscal year, about $114 billion less than the treasury pumped out during the same stretch one year earlier.

TREASURY PUSHES REVISED BANK ACCOUNT REPORTING PROPOSAL AS WAY TO CATCH RICH TAX CHEATS, BUT BANKS FIGHT BACK

Forbes - Ashlea Ebeling (2021-10-31)

Should tax cheats with unreported income pay their fair share of federal income taxes? That’s what’s at stake in the congressional tax compliance proposal that would reel in tax cheats by tracking bank account transfers. The proposal has riled industry players and stoked misinformation campaigns. Amid this backdrop, the Treasury Department issued a fact sheet today with details on a revised proposal to catch wealthy tax cheats, this time setting the bank account threshold at $10,000, up from $600, and providing an exemption for wage earners.

HERE’S WHY, ACTUALLY, THE IRS $600 BANK REPORTING PROPOSAL IS ENTIRELY REASONABLE

Forbes - Elizabeth Bauer (2021-10-31)

Over the last several days, we’ve seen the Outrage Machine in action over a new Treasury proposal to require banks to report to the IRS new information on U.S. bank accounts, in addition to the existing reporting of interest payments. This proposal, as described at CBS News (among, of course, many other sites) would require banks to report the gross annual inflows and outflows in bank accounts, ostensibly to catch high-income tax-dodgers. Because the threshold for reporting was set at $600, skeptics are, well, skeptical of the assertion that this change would only affect, as the Biden administration claims, those earning over $400,000 per year.

BOC LEANS ITS WEIGHT AGAINST INFLATION FEARS WITHOUT CHANGING ITS VIEW ABOUT TEMPORARY NATURE OF PRICE SPIKES

G&M - DAVID PARKINSON (2021-10-29)

The Bank of Canada has been staring inflation in the face for a while now. On Wednesday, it blinked.

BANK OF CANADA ENDS QE BOND BUYING PROGRAM, A SIGN THAT HIGHER RATES ARE COMING SOCIAL SHARING

CBC - Pete Evans (2021-10-28)

"The main forces pushing up prices — higher energy prices and pandemic-related supply bottlenecks — now appear to be stronger and more persistent than expected," the bank said, adding that it now thinks Canada's multi-year high inflation rate will go higher still — topping out at about five per cent, the bank said — before coming back down to the range of about two per cent next year.

TRUDEAU SHUFFLES CABINET

Investment Executive - Staff (2021-10-27)

Chrystia Freeland remains as deputy prime minister and minister of finance. Randy Boissonnault, one of two Liberal Alberta MPs, has been named associate minister of finance as well as minister of tourism.
Mona Fortier, who previously held the associate minister of finance role, will be president of the Treasury Board.

BANK OF CANADA ON THE CUSP OF CAPPING STIMULUS, PAVING THE WAY FOR RATE HIKES

FP - Shelly Hagan (2021-10-27)

Governor Tiff Macklem is expected to reduce weekly government bond purchases by one half on Wednesday to $1 billion (US$809 million). That will mark the fourth time over the past 12 months the central bank has rolled back a program that has poured hundreds of billions into the financial system since the start of the COVID-19 pandemic.

XI'S NOT THERE? COP26 HOPES DIM ON CHINESE LEADER'S LIKELY ABSENCE

Reuters - David Stanway (2021-10-26)

The leaders of most of the world's biggest greenhouse gas emitters gather in Glasgow from Sunday, aiming to thrash out plans and funds to tilt the planet towards clean energy. But the man running the biggest of them all likely won't be there.

AT WHAT POINT IS HIGHER INFLATION NO LONGER ‘TRANSITORY’?

G&M - Matt Lundy, David Parkinson (2021-10-26)

Earlier this month, a prominent U.S. economic think tank invited the Atlanta regional Federal Reserve president to deliver a speech on the outlook for inflation. He showed up with his Transitory Jar.

TIFF MACKLEM'S DASHBOARD: CHARTING ECONOMY'S EXIT FROM PANDEMIC PUZZLE

FP - Kevin Carmichael (2021-10-25)

Bank of Canada Governor Tiff Macklem has one objective: managing inflation, which the central bank defines as keeping the Consumer Price Index (CPI) advancing at an annual rate of about two per cent.

INVESTORS WATCHING FOR CLUES NEXT WEEK ABOUT MONETARY PATH

Investment Executive - Mark Burgess (2021-10-25)

The central bank is expected to maintain its overnight rate at 0.25% on Oct. 27 while reducing its weekly bond purchases of $2 billion.

DIGITAL MONEY IS AN OPPORTUNITY FOR CANADA – IF WE SEIZE IT

G&M - ROBERT FAY AND DAVID DODGE (2021-10-21)

Robert Fay is the managing director of digital economy at the Centre for International Governance Innovation. David Dodge is a former governor of the Bank of Canada and is senior adviser at Bennett Jones LLP.

FED PUTS ‘TOUGH’ INVESTMENT LIMITS ON TOP OFFICIALS IN BID TO STAUNCH SCANDAL

G&M - HOWARD SCHNEIDER AND ANN SAPHIR (2021-10-21)

The U.S. Federal Reserve on Thursday banned individual stock purchases by its top officials and unveiled a broad set of other restrictions on their investing activities, taking action roughly six weeks after reports of active trading by some U.S. central bank policy makers triggered an ethics uproar.

BANK OF CANADA NOT PLANNING TO LAUNCH DIGITAL CURRENCY, AT LEAST FOR NOW

Reuters - Reuters (2021-10-20)

“We haven’t made a decision to issue one yet because we basically don’t see a compelling need under current circumstances,” Bank of Canada Deputy Governor Timothy Lane told a virtual panel organized by a Washington think-tank.

BANK OF AMERICA’S CALIFORNIA PARTNERSHIP, LONG FLOURISHING, IS ROILED BY UNEMPLOYMENT FRAUD

WSJ - Ben Eisen and Christine Mai-Duc (2021-10-20)

Bank of America Corp. thought helping states such as California hand out unemployment benefits would be good business. Then millions of Americans lost their jobs at once.

THIS BOE IS MADE FOR HIKING AND THAT IS WHAT IT’LL DO

Bloomberg - Marcus Ashworth (2021-10-19)

With all the subtlety of a dropped hammer, Bank of England Governor Andrew Bailey dispelled what little doubt was left that U.K. interest rates would be raised before the end of this year. The central bank would “have to act” to reduce inflationary pressures, he declared at an online panel held on Sunday by the Group of 30, an organization of financiers and academics.
The whole gilt yield curve shifted higher Monday in reaction, with two-year yields at 0.75%, the highest since May 2019; 10-year yields have doubled over the past two months, making it the worst-performing major government bond market. U.K. money markets have priced in 50 basis points of rate hikes by year-end. It is overreaction, of course. But what else could the markets do as they bore witness to the previously super-dovish BOE’s road-to-Damascus conversion? The central bank had just until recently toyed with negative rates.
In the minds of most BOE policymakers, the debate whether inflation is transitory is over. Bailey’s remark makes clear that inflation is now flashing red because energy prices have soared, and those surges are expected to spill over into consumer behavior, business pricing and, ultimately, potential wage demands. The semantics of inflation is for the birds — and they are turning out to be hawks.

OFFSHORE HAVENS MAY BE STUNG BY GLOBAL TAX DEAL: MOODY’S

Investment Executive - James Langton (2021-10-19)

“If successfully implemented, the global minimum corporate tax rate will be mildly credit negative for sovereigns that have used tax policy as a key component of a broader competitiveness strategy to attract investment, such as Ireland, Hungary, and many Caribbean economies, which typically have corporate tax rates below 15%,” Moody’s said.

TRADERS INCREASINGLY DOUBT BANK OF CANADA'S RATE-HIKE TIMELINE

BNN - Erik Hertzberg (2021-10-19)

Bets in the overnight swaps market are increasingly tilting toward a move early next year, well ahead of the U.S. Federal Reserve. Traders have now priced in three hikes in Canada by the end of 2022, which would bring the policy rate to 1 per cent from the current 0.25 per cent.

DEMOCRATS SWARM VIRGINIA GOVERNOR RACE TO BLUNT EX-CARLYLE CEO

Bloomberg - Ryan Teague Beckwith (2021-10-18)

Democrats concerned by the tight race for Virginia governor are rushing to bolster Terry McAuliffe’s campaign in a state that could set the national momentum for the critical midterms and the 2024 presidential election.

TRUDEAU ANNOUNCES DATE FOR RECALL OF PARLIAMENT

Investment Executive - IE (2021-10-18)

Parliament will be recalled on Nov. 22 — just over two months after the snap election that returned the Liberals with a second consecutive minority.

BANK OF CANADA’S TIFF MACKLEM, BANK CEOS DIVERGE ON INFLATION OUTLOOK

G&M - Mark Rendell (2021-10-15)

Bank of Canada Governor Tiff Macklem is standing by his assertion that the current bout of high inflation is transitory, even as top Canadian bank executives question that narrative and warn that price pressures could persist.

FORMER CANADIAN CENTRAL BANKER PUSHES CORNWALL CONSENSUS AFTER WASHINGTON CONSENSUS DIES

G&M - Kevin Carmichael (2021-10-15)

At the time, her bosses at Finance as well as her former professors thought they had cracked the code by promoting a policy mix that emphasized free markets over government intervention. It came to define mainstream policy-making and was even given a name: the Washington Consensus, so called because the International Monetary Fund and the World Bank — both based in Washington, D.C. — were by then making loans contingent on spending discipline, market-determined exchange rates and the like.
“The Washington Consensus emerged at a time when it felt like market forces could deliver a lot of what we wanted, and if we focused on that, the benefits of increased growth, increased productivity, would be distributed to people in different income brackets and across different cultural groups,” Wilkins said in an interview on Oct. 13. “History has proved us wrong in that regard.”

MACKLEM AIMS TO TAKE BIGGER ROLE ON WORLD STAGE AFTER YEAR OF PUTTING OUT FIRES AT HOME

FP - Kevin Carmichael (2021-10-13)

Does the G20 even still meet? Maybe no one cares, but we probably should. Canada does better when the world’s bullies agree to down swords and respect a common set of rules and norms. Think back to 2008 and 2009. A smallish country’s banking system, apparently the soundest in the world, was still at the mercy of whatever shenanigans they were getting up to in the world’s major financial centres.
Canada has never really had the economic clout necessary to make people take notice, and it’s been a long time since we spent enough on the military to be of much help on security matters. But Ottawa has a tradition of sending technocrats out into the world to help keep the international conversation going, contributing ideas and/or time to efforts that have little direct connection to their day jobs.

U.S. HOUSE VOTES FOR SHORT-TERM DEBT CEILING FIX, AVERTING DEFAULT

Reuters - Susan Cornwell and Richard Cowan (2021-10-13)

The Democratic-controlled U.S. House of Representatives gave final approval on Tuesday to legislation temporarily raising the government's borrowing limit to $28.9 trillion, pushing off the deadline for debt default only until December.

GLOBAL CORPORATE TAX OVERHAUL ADVANCES AS 136 NATIONS SIGN ON

FP - Leigh Thomas (2021-10-12)

After years of missed deadlines and wrangling over how to handle global tech firms such as Facebook Inc. and Alphabet Inc.’s Google, Friday’s deal included a 15 per cent minimum rate for corporations and the main parameters of how much profits of multinationals would be taxed in more countries: 25 per cent of profits over a 10 per cent margin.

JANET YELLEN’S ABOVE-THE-FRAY APPROACH IS PUT TO A POLITICAL TEST

Bloomberg - Saleha Mohsin (2021-10-12)

President-elect Joe Biden chose former Federal Reserve Chair Janet Yellen to lead the U.S. Department of the Treasury for her gravitas, quiet consensus building, and attention to data—qualities that served her well during a decades-long central banking career. Democrats and Republicans alike laud her judgment.

OSFI SUMMARIZES RESPONSES TO ITS CLIMATE RISK DISCUSSION PAPER

OSFI - OSFI (2021-10-12)

For FRFIs, OSFI agrees guidance on climate-related risks should be principles-based and consider the Canadian context as well as international developments. Furthermore, any such guidance would be best informed by results from the Bank of Canada-OSFI joint pilot project on climate risk scenarios, for which stakeholders can expect further communication later this year. Taking these factors into account, OSFI expects to communicate next steps on its climate-related policy work early next year.

IMF CUTS GLOBAL GROWTH FORECAST, SAYS CENTRAL BANKS MUST BE VIGILANT ON INFLATION

G&M - Mark Rendell (2021-10-12)

Central banks should be prepared to act quickly if inflation proves to be more persistent than expected, the International Monetary Fund said Tuesday.

HIGH INFLATION COULD BE ‘A LITTLE MORE PERSISTENT’ THAN EXPECTED, BOC’S MACKLEM SAYS

G&M - Mark Rendell (2021-10-08)

Bank of Canada governor Tiff Macklem says high inflation could be “a little more persistent” than the central bank previously thought, while the economic recovery could take longer than expected.

TOKEN OF ALL TOKENS: COULD A $1T COIN FIX THE U.S. DEBT LIMIT?

CTV - Calvin Woodward (2021-10-06)

Some politicians think they've found a silver bullet for the impasse over the debt limit, except the bullet is made of platinum: Mint a $1 trillion coin, token of all tokens, and use it to flood the treasury with cash and drive Republicans crazy.

CANADIAN MUNICIPAL BONDS REMAIN 'UNDERVALUED' AS FINANCES IMPROVE, INVESCO'S HOOPER SAYS

FP - Derek Decloet (2021-10-06)

Cities such as Toronto suffered a fiscal blow after the pandemic forced them to lock down, crimping revenue from local sources such as transit and parking. But federal and provincial governments stepped in with billions in aid, strengthening the “implicit guarantee” on Canadian municipal debt, said Hooper, a senior portfolio manager with the Atlanta-based firm.

CANADA INVOKES 1977 TREATY WITH U.S. IN BID TO HALT LINE 5 CLOSING

G&M - Steven Chase (2021-10-05)

The move escalates a dispute in which U.S. President Joe Biden’s administration has been reluctant to intervene. Last May, U.S. Secretary of Energy Jennifer Granholm told reporters the White House had no plans to get involved, saying it would be up to the courts to settle.

THE DEBT CEILING: CAN THE US AVERT A DISASTROUS DEFAULT?

FT - Colby Smith (2021-10-05)

The US government is hurtling towards an unprecedented debt default in roughly two weeks’ time if lawmakers do not act to raise the federal limit on borrowing and enable the Treasury department to pay government commitments already approved by Congress.

DIVERSE BOARDS TO PICK THE NEXT BOSTON AND DALLAS FED BANK CHIEFS

Reuters - Ann Saphir (2021-10-05)

The searches soon to get underway for two new top U.S. central bankers will be an important test for what has been a rallying cry of sorts for proponents of diversity: that boards matter.

AN END TO SUPER-CHEAP MONEY? CENTRAL BANKS BEGIN TIGHTENING CYCLE

FP - Chris Giles (2021-10-04)

No longer are central bankers seeking to do whatever they can to ensure money is available for households, companies and governments to borrow at exceptionally favourable rates. Along with Norway’s monetary tightening, the first in any advanced economy since the pandemic began, four emerging economy central banks — Pakistan, Hungary, Paraguay and Brazil — also raised the cost of borrowing this week, while the U.S. Federal Reserve and Bank of England both signalled a move towards tightening monetary policy.
These guardians of monetary policy are generally satisfied that the economic recovery has proved stronger than they feared at the start of the year. But they are beginning to worry that money might become too cheap for too long. That would threaten rising inflation, excess borrowing and even financial instability as the world emerges from the coronavirus crisis.

CHINA EVERGRANDE TO SELL BANK STAKE TO STATE-OWNED FIRM FOR $1.5 BILLION

WSJ - Serena Ng and Xie Yu (2021-10-01)

A Chinese state-owned enterprise struck a deal to buy most of China Evergrande Group ’s stake in a commercial bank for $1.5 billion, the latest sign that the country’s authorities are trying to help the property giant resolve some of its financial troubles.

BANKING REGULATOR PLANNING FOR MORE VOLATILITY IN FINANCIAL SECTOR

Investment Executive - Ian Bickis (2021-10-01)

The regulator is working with the Bank of Canada and the private sector to better understand the risks that the transition will bring, and is also consulting widely on how to identify, measure and respond to climate-related risks, with more requirements coming, he said.

BOC LIKELY TO LET INFLATION RUN HOT, KEEP INTEREST RATES LOW, TEACHERS’ CHIEF ECONOMIST SAYS

FP - Shelly Hagan (2021-09-29)

“They want to go later. They want to ensure the self-sustaining recovery takes shape and that the output gap closes,” Mulraine said during a panel discussion at the Bloomberg Canadian Fixed Income Conference on Tuesday. “They will go on or just after the output gap closes.”

THE FIERCE URGENCY OF NOW: THE CANADIAN FINANCIAL SECTOR IN A POST-PANDEMIC WORLD, A PRUDENTIAL PERSPECTIVE

OSFI - OSFI (2021-09-29)

OSFI’s mandate says nothing about climate, but it does make us responsible for contributing to public confidence in Canada’s financial system. Getting to net zero by 2050 will mean Canada’s economy will have to adjust. Canada’s financial system will be a critical enabler to that adjustment and OSFI has an obligation to ensure that FRFIs and federally regulated pension plans (FRPPs) are fit to manage the risks that will accompany that adjustment.

U.S. SENATE FAILS TO ADVANCE DEBT CEILING, GOVERNMENT FUNDING MEASURE

Reuters - Richard Cowan and David Morgan (2021-09-28)

A sharply divided U.S. Senate failed on Monday to advance a measure to suspend the federal debt ceiling and avoid a partial government shutdown, as Republican lawmakers denied the bill the votes necessary to move forward.

U.S. SENATORS CALL FOR 'FULL ACCOUNTABILITY' IN WORLD BANK DATA CONTROVERSY

Reuters - David Lawder and Andrea Shalal (2021-09-28)

The top Democrat and Republican on the U.S. Senate Foreign Relations Committee have urged President Joe Biden to "ensure full accountability" over a World Bank data-rigging controversy that has embroiled International Monetary Fund chief Kristalina Georgieva.

NATIONAL DAY FOR TRUTH AND RECONCILIATION

OSFI - Peter Routledge (2021-09-28)

As an organization, OSFI is dedicated to increasing Indigenous representation. In addition to facilitating underrepresented groups, including Indigenous peoples, to apply for positions, we are expanding our reach to more areas of the country where members of those groups reside. We are also supporting our managers to familiarize themselves with the benefits of employment equity hiring and to increase diversity on their selection boards and teams.

PELOSI SETS THURSDAY VOTE ON PASSAGE OF $1 TRILLION INFRASTRUCTURE BILL

Reuters - Reuters (2021-09-26)

"Tomorrow, September 27, we will begin debate on the Bipartisan Infrastructure Framework on the Floor of the House and vote on it on Thursday, September 30, the day on which the surface transportation authorization expires," Pelosi said in a letter to her fellow Democrats released by her office.

CENTRAL BANKS CAN DO A LOT FAST. WILL IT BE THEIR DOWNFALL?

Bloomberg - Daniel Moss (2021-09-26)

Central banks were the first economic responders to the Covid-19 pandemic. From Washington to Wellington, policy makers swiftly deployed tools developed during the global financial crisis and found new ways to shore up credit markets vital to the functioning of modern commerce.

FEDERAL DEFICIT HIT $48.5 BILLION OVER FIRST FOUR MONTHS OF FISCAL YEAR

Investment Executive - CP (2021-09-26)

Friday’s fiscal monitor says the deficit to date now reflects current economic challenges caused by Covid-19, including ongoing public health restrictions.

BRITAIN'S SUNAK ACCEPTS CALL FOR FINANCIAL REFORMS AFTER GREENSILL COLLAPSE

Reuters - Reuters (2021-09-24)

British finance minister Rishi Sunak has ordered two immediate reviews of the country's financial regulation related to the collapse of supply chain finance firm Greensill Capital.

FED'S POWELL SAYS TAPER COULD START IN NOVEMBER, END MID-2022

FP - Matthew Boesler (2021-09-23)

That refers to the policy gathering on Nov. 2-3, though he left the door open to waiting longer if needed and stressed that tapering was not meant to be a direct signal on the timing of rate liftoff.

FED LIKELY TO OPEN BOND-BUYING 'TAPER' DOOR, BUT HEDGE ON OUTLOOK

Reuters - Howard Schneider (2021-09-22)

The Federal Reserve is expected to clear the way on Wednesday for reductions to its monthly asset purchases later this year and show in updated projections whether higher-than-expected inflation or a resurgent coronavirus pandemic is weighing more on the economic outlook.

FED TO REVEAL NEW PROJECTIONS WITH INVESTORS ON ALERT FOR RATE LIFTOFF TIMING

Reuters - Lindsay Dunsmuir (2021-09-21)

U.S. Federal Reserve officials will lay bare how soon and how often they think the economy will need interest rates rises over the next three years when they release new forecasts at their policy meeting on Wednesday, with investors on alert for a faster pace of tightening.

CANADIAN DOLLAR CLINGS TO WEEKLY GAIN AS CHINA INJECTS LIQUIDITY

G&M - Reuters (2021-09-19)

The Canadian dollar 

U.S. TREASURY'S YELLEN: DEBT DEFAULT WOULD 'PERMANENTLY' WEAKEN AMERICA

Reuters - David Lawder (2021-09-19)

U.S. Treasury Secretary Janet Yellen issued a fresh plea for Congress to raise the federal debt ceiling on Sunday, arguing a default on U.S. debt would trigger a historic financial crisis.

BANKS, ENERGY SHARES MAY MOVE AS CANADA VOTES: INVESTORS’ GUIDE

Bloomberg - Michael Bellusci (2021-09-19)

With Canadians set to vote Monday in a highly competitive election, the outlook for the two largest sectors in country’s stock index hangs in the balance.

U.S. BANKING REGULATORS WORKING ON CLIMATE RISK MANAGEMENT GUIDANCE, OFFICIAL SAYS

Reuters - Michelle Price (2021-09-16)

U.S. banking regulators are working on new climate risk management guidance for large lenders, a top official said on Wednesday, in another sign of efforts to incorporate the risks posed by rising temperatures into financial rules.

INVESTORS TENSE UP AS FEARS OF POST-ELECTION GRIDLOCK RISE IN CANADA

Reuters - Fergal Smith (2021-09-16)

Foreign investors are growing more worried that Canada's federal election on Monday could result in a deadlock that hampers Ottawa's response to the COVID-19 pandemic and further slows the economic recovery from the crisis.

DODD-FRANK ARCHITECTS CALL FOR REAPPOINTMENT OF FED'S POWELL

Reuters - Howard Schneider (2021-09-14)

The Democratic architects of a key overhaul of U.S. financial regulation a decade ago called on President Joe Biden to reappoint Fed Chair Jerome Powell to a second term, rebuffing arguments he has been weak on regulatory issues.

AFTER THE 'BAZOOKA', BANK OF JAPAN DISMANTLES THE WORK OF ITS RADICAL CHIEF

Reuters - Leika Kihara (2021-09-13)

After years of shock-and-awe stimulus, the Bank of Japan is quietly rolling back radical policies introduced by its bold chief Haruhiko Kuroda and pioneering controversial new measures that blur the lines between central banking and politics.

TREASURY, FINANCIAL INDUSTRY DISCUSS CRYPTOCURRENCY 'STABLECOINS'

Reuters - Pete Schroeder (2021-09-13)

The U.S. Treasury Department met with a number of industry participants this week to quiz them about the risks and benefits posed by stablecoins -- a rapidly growing type of cryptocurrencies, the value of which is pegged to traditional currencies, according to three people with direct knowledge of the meetings.

YELLEN URGES QUICK U.S. ADOPTION OF STABLECOIN RULES

Reuters - Pete Schroeder (2021-09-13)

The group discussed the rapid growth of stablecoins, which are cryptocurrencies that attempt to peg their values to a conventional currency, like the U.S. dollar, according to the Treasury. Regulators discussed their potential uses, as well as risks to end users and the financial system.

BANK OF CANADA PLANS TO RAISE KEY RATE BEFORE WINDING DOWN BOND BUYING PROGRAM, MACKLEM SAYS

G&M - Mark Rendell (2021-09-10)

Bank of Canada Governor Tiff Macklem has provided the clearest picture yet on how the central bank plans to reduce monetary stimulus, saying it expects to start raising interest rates before entirely winding down its bond buying program.

CAN THE CONSERVATIVES ACTUALLY BALANCE THE FEDERAL BUDGET WITHIN 10 YEARS?

G&M - Patrick Brethour (2021-09-10)

The Conservatives are promising to balance the federal budget within 10 years without spending cuts or tax increases, even as they add tens of billions of dollars in new spending on top of the 2021 budget.

BANK OF CANADA SEES RECOVERY ON TRACK, STAYS COURSE ON POLICY

FP - Kevin Carmichael (2021-09-10)

The message from Canada’s central bankers was that “even though the recovery lost a bit of steam in the second quarter, the ingredients are there for economic activity to strengthen through the remainder of the year,” Sri Thanabalasingam, an economist at Toronto-Dominion Bank, said in a note to clients. “While the Delta variant could complicate matters, the bank, like us, do not expect the virus to blow the recovery off course in the fourth quarter.”

BANK OF CANADA’S NEW OPENNESS GETS A TEST DURING FEDERAL ELECTION CAMPAIGN

G&M - DAVID PARKINSON (2021-09-09)

The Bank of Canada has returned from an eventful summer with a tricky job on its hands: how to communicate vital information while keeping your mouth shut.

ANK OF CANADA SEES RECOVERY ON TRACK, STAYS COURSE ON POLICY

FP - Kevin Carmichael (2021-09-09)

As expected, governor Tiff Macklem and his deputies opted to leave the current level of stimulus unchanged at the end of their latest round of interest-rate deliberations on Sept. 8. The election raised the bar for a shift in policy, as Macklem would only risk becoming a campaign issue if economic conditions demanded it. They didn’t, allowing the governor to turn the central bank’s latest interest-rate decision into a non-event.

BANK OF CANADA MAY DELAY QUANTITATIVE EASE TAPER, MARKET DOUBTS RATE HIKES: RBC

Better Dwelling - Daniel Wong (2021-09-09)

Remember, this isn’t just low rates. They’re flooding the system with credit to push the cost of goods higher. Delaying a taper would mean adding billions more in credit stimulus for longer.

ELECTION CAMPAIGN TO KEEP BANK OF CANADA QUIET: DECISION GUIDE

Bloomberg - Shelly Hagan (2021-09-08)

The Bank of Canada will likely tread carefully this week, mutedly acknowledging a weaker-than-expected economy in the midst of a heated election campaign.

BANK OF CANADA EXPECTED TO STAY THE COURSE IN THIS WEEK’S POLITICALLY SENSITIVE RATE DECISION

G&M - Mark Rendell (2021-09-07)

The Bank of Canada is widely expected to hold the line on monetary policy this week after a series of economic releases showed weaker-than-expected growth even as inflation hit a decade-high.

BUSINESS INSOLVENCY FILINGS DROP TO 35-YEAR LOW, BUT 'SLEW' OF FILINGS FEARED AFTER PANDEMIC AID ENDS

FP - Kelsey Rolfe (2021-09-07)

Just 160 businesses filed for insolvency in July, marking a 35-year low in new filings, according to new data from the Office for the Superintendent of Bankruptcy.
The record low, which represented a 28.3 per cent decrease in filings from the month prior, is largely due to the federal government’s pandemic wage and rent subsidies and other business support programs such as the Canada Emergency Business Account, which have been extended until October.

JUSTIN TRUDEAU RELEASES LIBERALS’ MULTIBILLION-DOLLAR PLATFORM; INCLUDES 15% TAX FOR HIGH-INCOME EARNERS

G&M - BILL CURRY AND CAMPBELL CLARK (2021-09-02)

The platform estimates the federal deficit will decline from $156.9-billion this year to $32-billion in 2025-26, but offers no timeline for erasing it entirely. Those annual deficits would be $14-billion higher per year on average than the pre-election forecast the Parliamentary Budget Officer released in August.

CHINESE STATE FIRMS TO TAKE BIG STAKE IN ANT'S CREDIT-SCORING JV -SOURCES

Reuters - Julie Zhu (2021-09-02)

State-backed firms are set to take a sizeable stake in a key Ant Group asset for the first time, three people told Reuters, in a move that will loosen the Chinese fintech giant's grip on a data treasure trove of over 1 billion users but help revive its IPO.

HOW RICHARD NIXON ROCKED THE WORLD 50 YEARS AGO WITH JUST THE GREENBACK AND GOLD

FP - Colin McClelland (2021-09-01)

Nixon unhitched the U.S. dollar from the value of gold. The move changed the global monetary system almost overnight. The eventual result was the floating international exchange rates we still use today.
The worldwide economy had expanded greatly and U.S. dollar use was widespread. It was good to have the global currency, but there were four times as many dollars in circulation as the U.S. had in gold reserves to back them up. This Bretton Woods exchange rate system, named after the New Hampshire town where it was hammered out after the Second World War, was running out of steam.

SCOTIABANK ECONOMIST RIPS CANADA AGENCY FOR ELECTION GDP ‘BOMB’

Bloomberg - Erik Hertzberg (2021-09-01)

A prominent bank economist hurled criticism at Canada’s statistics agency after it revised its economic figures for April and May with little explanation, giving Prime Minister Justin Trudeau’s political opponents an opening to criticize his record.

FED'S MESTER NOT READY TO ACCEPT RECENT INFLATION SURGE AS MEETING CENTRAL BANK'S GOAL

Reuters - Jonnelle Marte (2021-08-31)

Cleveland Federal Reserve Bank President Loretta Mester said on Monday that the U.S. economy is recovering strongly but she is not yet convinced that recent inflation readings will be enough to satisfy the price stability goal the U.S. central bank revamped a year ago.

TRUDEAU’S POPULIST POSE COULD HURT CANADA’S ECONOMY

Bloomberg - Michael R. Strain (2021-08-31)

Prime Minister Justin Trudeau of Canada would reject claims that his leadership style is similar to that of former U.S. President Donald Trump or British Prime Minister Boris Johnson. But in at least in one respect the comparison is getting closer to hitting its target.

U.S. WILL RAISE RATES AS LONG AS HIRING KEEPS IMPROVING, POWELL TELLS JACKSON HOLE

CBC - AP (2021-08-30)

The Federal Reserve will start dialing back its ultra-low-rate policies this year as long as hiring continues to improve, Chair Jerome Powell said Friday, signaling the beginning of the end of the Fed's extraordinary response to the pandemic recession.

CENTRAL BANKS' SHIFT FROM CRISIS POLICIES GATHERS MOMENTUM

Reuters - Dan Burns (2021-08-27)

While the financial world waits for the Federal Reserve to start reversing its ultra-loose policy stance, recent moves by a clutch of other central banks signal the days of pandemic-era accommodation are already numbered even as COVID-19 continues to impede smooth economic recoveries around the world.

TRUDEAU VOWS 3% SURTAX ON BIG BANKS, INSURANCE TO GENERATE EXTRA $2.5 BILLION

FP - Kait Bolongaro and Kevin Orland (2021-08-26)

At a campaign stop in Vancouver, the leader of the governing Liberals promised to hike the corporate income tax rate by three percentage points on profit over $1 billion (US$793 million) at financial institutions. The measures, which would bring the rate to 18 per cent from 15 per cent currently, are expected to generate $2.5 billion for government coffers over the next four years, starting in 2022-3, according to a party news release.

GOLDMAN SACHS RAISES ODDS ON U.S. FEDERAL RESERVE TAPER ANNOUNCEMENT IN NOVEMBER

G&M - Reuters (2021-08-25)

Goldman Sachs economists have raised the odds that the U.S. Federal Reserve will announce the start of tapering its bonds purchases in November, predicting the central bank will likely opt to dial back purchases by US$15-billion then and at meetings that follow.

FED CHAIR JEROME POWELL CHARMED BOTH REPUBLICANS, DEMOCRATS IN U.S. CONGRESS

FP - Christopher Condon, Steven T. Dennis and Saleha Mohsin (2021-08-25)

Powell has worked Congress during his three years at the helm like no Fed chair since Alan Greenspan. But where Greenspan was a regular of the cocktail party circuit, Powell has taken a more workmanlike approach.

THINK TANK REPORT OFFERS MIXED ASSESSMENT OF FEDERAL RESERVE CHAIR JEROME POWELL’S TENURE

G&M - Ann Saphir (2021-08-24)

A think tank highly critical of Federal Reserve chair Jerome Powell’s record on banking regulation released an assessment of his four-year tenure on Monday that is by turns scathing and complementary, highlighting the competing considerations as U.S. President Joe Biden weighs whether to reappoint him.

SWEDEN’S DEPARTING PREMIER PAVES A PATH FOR FINANCE CHIEF

Bloomberg - Ott Ummelas and Niclas Rolander (2021-08-23)

The resignation of Sweden’s Stefan Lofven brings the largest Nordic economy a step closer to its first-ever female prime minister, and with it the task of fixing an ailing political system.

CENTRAL BANKS ARE RISKING THEIR INDEPENDENCE

Bloomberg - Mervyn King and Dan Katz (2021-08-23)

Central bankers and journalists will assemble for the virtual Jackson Hole conference later this week. Their agenda will be broad. The future path of quantitative easing, the health of the labor market, and other critical monetary and regulatory matters will command center stage. But we can also expect pronouncements on issues once considered the domain of elected politicians, including climate change, racial justice and inequality.

CHINA'S PLANNED ANTI-SANCTIONS LAW FOR HONG KONG UNSETTLES FINANCIAL SECTOR

Reuters - Alun John and Scott Murdoch (2021-08-20)

Global banks and other financial institutions in Hong Kong are scrambling to find out details of China's planned imposition of an anti-sanctions law on the city, and trying to understand how it could impact their operations in the financial hub.

AFGHANISTAN CENTRAL BANKER FLEES, CURRENCY DROPS TO RECORD LOW AMID TUMULT

FP - Kartik Goyal and Rahul Satija (2021-08-18)

The Afghani fell as much as 1.7 per cent on Tuesday to 83.5013 per dollar, a fourth day of decline, according to data compiled by Bloomberg. The central bank was told there would be no more dollar shipments on Friday, which curtailed its ability to supply currency and led to more panic, acting Governor Ajmal Ahmady wrote in a Twitter thread.

NOBODY’S RUNNING LEBANON, CENTRAL BANK BOSS SAYS

G&M - LAILA BASSAM AND NAFISA ELTAHIR (2021-08-16)

Lebanon’s central bank governor said nobody was running the country, hitting back after government criticism of his decision to halt fuel subsidies that have drained currency reserves.

TRUDEAU TRIGGERS SNAP ELECTION, SENDING CANADIANS TO THE POLLS ON SEPT. 20

G&M - Robert Fife (2021-08-16)

Justin Trudeau has triggered a long-expected snap election, seeking to gain a majority on the strength of his Liberal government’s record in managing COVID-19 – but opposition parties are casting the campaign as unnecessary and a blatant attempt at a power grab amid the fourth wave of the pandemic.

TRUDEAU PLANNING TO CALL SNAP ELECTION FOR SEPT. 20 AS CANADA ENTERS FOURTH WAVE

G&M - LEE BERTHIAUME AND MIA RABSON (2021-08-13)

Prime Minister Justin Trudeau is expected to trigger an election on Sunday by asking Gov. Gen. Mary Simon to dissolve Parliament even though Canada’s top doctor says the country is now in the grips of a fourth wave of COVID-19.

AS MARKETS STABILIZE, OSFI ALLOWS LEVERAGE RELIEF TO EXPIRE

Investment Executive - James Langton (2021-08-13)

“When OSFI introduced this special treatment of leverage ratio exposure measures in the spring of 2020, it was the appropriate response at the time to the uncertainty created by the pandemic,” said Ben Gully, OSFI’s assistant superintendent, regulation sector, in a statement.

ERIN O’TOOLE’S ANTI-TRADE, ANTI-BUSINESS STAND IS AT ODDS WITH HIS OWN PARTY’S HISTORY

G&M - DAVID PARKINSON (2021-08-11)

Conservative Leader Erin O’Toole pitches his position on free trade as a stand against the failed policies of the Liberal government. In reality, his battle is with the ghosts of his own party.

THE DEBT-CEILING FARCE IS A HEADACHE INVESTORS COULD DO WITHOUT

Bloomberg - Benjamin Purvis (2021-08-11)

The very existence of the debt ceiling is utterly superfluous. Every couple of years members of Congress have to vote to allow borrowing to fund measures that they’ve already approved through individual spending bills.
Its main function is political: Whichever party isn’t in power at the time uses it to try to either extract something from, or embarrass, the other side.
On top of that, the limit isn’t really the limit. By invoking the vague catchall of “extraordinary measures,” Uncle Sam can keep on borrowing even after it’s hit the cap—or when the limit has been reinstated following a suspension, as was the case at the end of last month. Given that the alternative is either what’s known as a technical default or a seizing up of everyday government spending, that’s a good thing, even if you’re a fiscal hawk, which is an endangered species these days.

LEAH ANDERSON APPOINTED INTERIM CDIC HEAD

Investment Executive - IE (2021-08-10)

Leah Anderson is taking over as interim head of the Canada Deposit Insurance Corporation (CDIC) after Peter Routledge left the post to lead the Office of the Superintendent of Financial Institutions (OSFI).

B.C. JUDGE TAKES AIM AT HEART OF CASE AGAINST MENG WANZHOU

G&M - Sean Fine (2021-08-06)

The U.S. summary – which in Canadian law is presumed to be reliable – is missing a key word: “Huawei’s engagement with Skycom is normal business co-operation.” The word “controllable” does not appear.

FINANCIAL REGULATORS IIROC AND MFDA TO BE MERGED INTO ONE

CBC - CP (2021-08-05)

The roles of both regulatory bodies have increasingly overlapped in recent years, prompting calls to review the regulatory framework.

FINCEN NAMES NEW ACTING DIRECTOR, BEGINS SEARCH FOR PERMANENT CHIEF

WSJ - Dylan Tokar (2021-08-05)

The U.S. Treasury Department’s anti-money-laundering unit is undergoing its second leadership change this year, as current acting director Michael Mosier prepares to leave at the end of the week.

CANADA’S CENTRAL BANK HEAD WROTE A BIZARRE OPINION PIECE TO SAY HE’S NAILING IT

Better Dwelling - Stephen Punwasi (2021-08-05)

The sitting head of the central bank made the unusual move of writing an opinion column. Instead of using fancy data points, he whipped out a pen and provided no evidence to explain the current inflation environment. It wasn’t his first time either, with economists previously asking him to provide any evidence for the statements he’s made.  

CANADA SETS PLAN TO MERGE INVESTMENT REGULATORS INTO ONE AGENCY

Bloomberg - Kevin Orland and Paula Sambo (2021-08-04)

Canada’s securities regulators plan to merge two industry groups that oversee financial advisers into a single organization, a move intended to address years of complaints about the overlapping roles and higher costs of the groups.

THE HORROR SCENARIO LURKING IN THE PLUMBING OF FINANCE

FP - John Dizard (2021-08-03)

The equivalent fear hanging over the financial system now is: “Don’t create an artificial shortage of good collateral! No! No!”

BANK OF CANADA RESEARCHERS ARGUE IN FAVOUR OF INFLATION OVERSHOOTS FOLLOWING RECESSIONS

G&M - Mark Rendell (2021-07-29)

Central bankers should let inflation run temporarily above target when the economy is coming out of a severe recession, according to new Bank of Canada research that provides a window into how the central bank is thinking about inflation as the pandemic wanes.

BANK OF CANADA APPOINTS FIRST HEAD OF RETAIL PAYMENTS SUPERVISION

G&M - Mark Rendell (2021-07-29)

In June, the bank assumed responsibility for monitoring online payment systems, such as digital wallets, run by fintech and paytech companies. The new system will see the bank maintain a registry of retail payment providers in Canada, and monitor the strength of their risk-management protocols.

AS FED TIPTOES AROUND TAPERING, INVESTORS LOOK TO JACKSON HOLE MEETING FOR CLARITY

Reuters - David RandallGertrude Chavez-dreyfuss (2021-07-29)

Investors looking for clear guidelines on when the Federal Reserve will begin tapering its massive bond purchases were left waiting Wednesday, with all eyes next on the annual Jackson Hole conference of central bankers in August.

OSFI FINALIZES ITS GUIDELINE ON FOREIGN ENTITIES OPERATING IN CANADA ON A BRANCH BASIS

OSFI - OSFI (2021-07-29)

Today, the Office of the Superintendent of Financial Institutions (OSFI) issued the final version of Guideline E-4 Foreign Entities Operating in Canada on a Branch Basis. This guideline replaces existing guidelines E-4A Role of the Chief Agent and Record Keeping Requirements and E-4B Role of the Principal Officer and Record Keeping Requirements.

BANK OF CANADA RESEARCHERS ARGUE IN FAVOUR OF INFLATION OVERSHOOTS FOLLOWING RECESSIONS

G&M - Mark Rendell (2021-07-28)

Central bankers should let inflation run temporarily above target when the economy is coming out of a severe recession, according to new Bank of Canada research that provides a window into how the central bank is thinking about inflation as the pandemic wanes.

ONTARIO SETS RECORD FOR LOONIE GREEN BOND BEFORE FEDERAL SALE

Bloomberg - Esteban Duarte (2021-07-28)

The province of Ontario broke the record for a Canadian dollar green bond sale, raising C$2.75 billion ($2.19 billion) on Tuesday to fund a train line expansion among other purposes.

CENTRAL BANKS SHOULD BE READY TO ACT SWIFTLY IF INFLATION ISN’T TRANSITORY: IMF

Better Dwelling - Daniel Wong (2021-07-28)

The combination has pushed global inflation readings higher. Canada’s consumer price index (CPI) is currently reading 3.6% higher than a year before. US CPI came in even higher, showing annual growth of 5.4% at the last measure. This is the highest rate both countries have experienced in a very long time. Naturally, people are starting to worry about how high this can get over the next few years. 

U.S. TREASURY SECRETARY YELLEN WARNS CONGRESS ON DEBT LIMIT

Reuters - Doina Chiacu (2021-07-26)

U.S. Treasury Secretary Janet Yellen urged lawmakers on Friday to increase or suspend the nation's debt limit as soon as possible and warned that if Congress does not act by Aug. 2 the Treasury Department would need to take "extraordinary measures" to prevent a U.S. default.

FSRA PROPOSES FEES FOR TITLE REGULATION

Investment Executive - James Langton (2021-07-23)

FSRA is proposing a $10,000 fee for the initial approval of a credentialing body, and $5,000 for each credential application.

BANK OF CANADA APPOINTS SHARON KOZICKI DEPUTY GOVERNOR

G&M - Mark Rendell (2021-07-21)

The Bank of Canada has appointed long-time central banker Sharon Kozicki to the position of deputy governor – the second change to the bank’s governing council this month.

HOUSING TAKES ON LARGER EMPHASIS IN INFLATION TRACKING

G&M - Matt Lundy (2021-07-21)

Indeed, the new CPI basket was noticeably influenced by abrupt changes in how Canadians spent amid COVID-19.

A DRAMATIC REBOUND IN HIRING COULD THROW THE BANK OF CANADA’S INFLATION EXPECTATIONS FOR A LOOP

G&M - DAVID PARKINSON (2021-07-20)

The Bank of Canada’s strongest argument against the current concerns of rising inflation is the big hole in employment left by COVID-19. But what if that hole suddenly filled in?

IF CENTRAL BANKS DON’T WANT US TO WORRY ABOUT INFLATION, THEY SHOULD SOUND MORE LIKE THEY DO

G&M - Andrew Coyne (2021-07-19)

Confirmation bias being what it is, inflation hawks and doves have each been able to point to evidence in recent days to prove their point.

WHAT MIGHT THE BANK OF ENGLAND DO TO WEAN THE UK ECONOMY OFF STIMULUS?

Reuters - Reuters (2021-07-19)

Two top Bank of England officials surprised investors this week by saying the time might be nearing for the British central bank to rein in the huge stimulus programme it has used to steer the economy through the coronavirus crisis.

TRUDEAU’S RHETORIC CAN’T CHANGE CANADA’S FISCAL REALITY

G&M - JASON CLEMENS, MILAGROS PALACIOS AND NIELS VELDHUIS (2021-07-16)

One of the differences between being on the opposition and government benches is that the government must be held accountable for actual performance. The evidence is quite clear that the Trudeau government has increased taxes, has overseen a marked increase in government indebtedness and recorded comparatively weak economic growth. Rhetoric can’t change that reality.
It’s imperative Canadians distinguish between convenient political rhetoric and reality when it comes to the country’s finances, particularly as we approach a potential fall election. The Trudeau government continues to promulgate three assertions that must be clarified.

THE LOONIE IS SINKING FAST – AND THE FED IS TO BLAME

G&M - David Berman (2021-07-16)

The Canadian dollar has been losing ground over the past two months, but don’t pin the blame on softer commodity prices, shifting Bank of Canada monetary policies or general risk aversion among global investors.

MONETARY POLICY REPORT PRESS CONFERENCE OPENING STATEMENT

OSFI - OSFI (2021-07-15)

The Governing Council also discussed the amount of slack in the economy and the outlook for potential growth. Estimates of these measures have always been imprecise but are especially difficult given the rapid changes wrought by the pandemic. In the projection, economic slack is absorbed in the second half of 2022. To help manage the uncertainty surrounding this assessment, we will be watching a broader spectrum of indicators of slack, including a range of labour market measures.

BANK OF CANADA PARES BACK BOND BUYING, RAISES INFLATION FORECAST

G&M - Mark Rendell (2021-07-15)

The central bank cut its government bond purchases to a target of $2-billion a week, from $3-billion, further reducing the stimulus put in place early in the COVID-19 pandemic. It held its policy rate at 0.25 per cent and reaffirmed it does not expect to raise interest rates before the second half of 2022 at the earliest.

BANK OF CANADA TO FURTHER TAPER TOXIC PROGRAM THAT HELPED PUSH HOME PRICES HIGHER

Better Dwelling - Stephen Punwasi (2021-07-15)

Yeah, that’s not a typo. Billion, with a B. Per week. Today the BoC announced their widely expected move to trim their QE program. The rate of QE will be slowed to $2 billion per week, down from the $3 billion prior. The program had been cut earlier this year as well, down from $4 billion per week. The program’s size was just reduced by a third, and it’s half as much as it was earlier this year. 

BANK OF CANADA EXPECTED TO FURTHER TAPER BOND PURCHASES THIS WEEK

G&M - Mark Rendell (2021-07-14)

The recent positive Canadian data, on top of several months of higher-than-expected inflation, should give the central bank conviction to move ahead with another cut to its weekly federal government bond-buying program, known as quantitative easing, analysts argued. The consensus view among economists is for the bank to reduce its pace of QE purchases – which are designed to hold down interest rates and encourage borrowing – to $2-billion a week from $3-billion.

CMHC AT A CROSSROADS: AGENCY FACES TOUGH DECISIONS AFTER LOSING MORTGAGE INSURANCE MARKET SHARE

FP - Stephanie Hughes (2021-07-13)

“There is no doubt that we have willingly chosen to forgo some profitable business that our competitors would find appealing,” then-chief executive Evan Siddall wrote in August, in a letter to Canada’s biggest lenders, following the implementation of the stricter standards. Siddall used the letter to caution the banks and others mortgage lenders about risky lending, warning that “there is a dark economic underbelly to this business that I want to expose.”

GREENSILL CAPITAL PAID DAVID CAMERON SALARY OF OVER $1 MILLION A YEAR -FT

Reuters - Reuters (2021-07-13)

Collapsed finance group Greensill Capital paid a salary of more than $1 million a year to former British Prime Minister David Cameron, the Financial Times reported on Monday, citing people familiar with the matter.

BANK OF CANADA WILL GET MORE ROOM TO HIKE RATES WITH US FED TURNING HAWKISH: RBC

Better Dwelling - Daniel Wong (2021-07-09)

A hike from the US would allow the BoC to hike, with much less pressure on currency exchange. If Canada hiked alone, it would slow credit growth and inflation, but may also impact exports. If both countries do it at the same time, the loonie’s increase against the US dollar would be minimal. That gives the BoC a little more room to make the next increase more comfortable… or hike even more if needed.

INFRASTRUCTURE BANK REFUSES MPS’ REQUEST TO DETAIL EXECUTIVE BONUSES

G&M - Bill Curry (2021-07-08)

The Canada Infrastructure Bank is refusing to disclose bonuses paid to executives despite a unanimous vote by MPs on a House of Commons committee calling for the amounts to be revealed.

FED OFFICIALS SAW PROGRESS TOWARD TAPER MOVE, MINUTES SHOW

FP - Craig Torres (2021-07-08)

The June meeting marked a turn in the central bank’s comfort with inflation risks amid heightened price pressures as the economy reopens from the pandemic, buoyed by massive monetary and fiscal-policy support. Officials also continued monthly purchases of US$80 billion of Treasuries and US$40 billion of mortgage-backed securities until “substantial further progress’ was made on inflation and employment.

BRITISH COLUMBIA’S AAA RATING IS STRIPPED BY S&P ON RISING DEBT

Bloomberg - Esteban Duarte (2021-07-08)

Canada’s third-largest province will run a deficit this fiscal year that’s “significantly larger” than expected when the pandemic began, which will likely lengthen the time to return to fiscal balance, S&P said in a statement Wednesday explaining the one-notch downgrade to AA+. The move comes less than two weeks after Fitch Ratings took a parallel rating action.

WHY WE SHOULD BE RELIEVED CANADIAN BANKS CAN’T INCREASE DIVIDENDS YET

G&M - Rita Trichur (2021-07-06)

It’s okay to admit it. After all, five big U.S. banks are increasing their dividends, and some are also planning to buy back their shares, moves that will handsomely reward their investors as the economy recovers from the pandemic.

130 COUNTRIES BACK OECD PLAN TO SET GLOBAL MINIMUM CORPORATE TAX RATE

CBC - AP (2021-07-05)

Some 130 countries have agreed on a global minimum tax backed by U.S. President Joe Biden as part of a worldwide effort to keep multinational firms from dodging taxes by shifting their profits to countries with low rates.

BANK OF CANADA IS QUIETLY UPDATING FORECAST MODELS TO INCLUDE DEBT AND REAL ESTATE

Better Dwelling - Stephen Punwasi (2021-07-05)

Remember that time the head of Canada’s central bank said the housing bubble was good for the economy? Soak it up, because that may be the last time it ever happens. The Bank of Canada (BoC) finished its technical report on the Terms-of-Trade Economic Model (ToTEM). The model, which is used by the BoC as their primary forecasting tool, has now entered its third update in 15 years.

CANADA AMONG 130-NATION DEAL TO OVERHAUL GLOBAL CORPORATE TAX RULES

G&M - Bill Curry (2021-07-02)

After years of negotiations, the United States, Canada and 128 other countries have announced a new global pact to overhaul the way large multinational companies are taxed.

BANKS COULD FACE MAJOR DISRUPTION FROM PUBLIC DIGITAL CURRENCIES, CARNEY SAYS

G&M - Mark Rendell (2021-07-02)

Dozens of monetary authorities around the world are contemplating launching central bank digital currencies (CBDCs), largely in response to the proliferation of cryptocurrencies and private digital currencies backed by large technology companies, such as Facebook Inc.

FITCH DOWNGRADES B.C.’S CREDIT RATING PARTLY BECAUSE OF FEDERAL DEBT

G&M - Patrick Brethour (2021-06-28)

British Columbia has lost a triple-A credit rating, with Fitch Ratings Inc. downgrading the province in part because of Canada’s rising federal debt burden.

FINANCE DEPARTMENT EXPERIENCING WAVE OF SENIOR DEPARTURES

G&M - Bill Curry (2021-06-28)

Several of the most senior officials in the federal Finance Department are leaving government – or have already left – after playing key roles in shaping Ottawa’s massive policy response to the COVID-19 pandemic.

CENTRAL BANKS’ BATTLE AGAINST PRIVATE ENTITIES TO CONTROL CRYPTOCURRENCIES HAS OFFICIALLY BEGUN

G&M - Ian McGugan (2021-06-28)

Central banks are bracing for a showdown with purveyors of cryptocurrencies and other private forms of money. To help win that battle, they are counting on a still murky concept known as central bank digital currencies, or CBDCs.

THE FUTURE OF MONEY: THE DIGITAL CURRENCY REVOLUTION IS HERE, AND MAY SWEEP AWAY 5,000 YEARS OF MONETARY HISTORY

G&M - Michael Doyle (2021-06-28)

For several hundred years, the people living on the Pacific island of Yap used giant rocks as a basic form of money. The most valuable of these massive limestone rings, called rai stones, weighed several thousand kilograms. As a result, they weren’t easily exchanged when an item was bought or sold. Boulders that were too big to roll from one owner to the next were left in a permanent resting place.

CANADA’S BANKING REGULATOR NAMES PETER ROUTLEDGE AS NEXT HEAD

G&M - James Bradshaw (2021-06-25)

The federal government has named Peter Routledge as the head of Canada’s banking regulator, choosing a former financial analyst and federal policy adviser with a keen understanding of the financial system’s intricacies who also has recent experience running a federal agency.

Mr. Routledge will take the helm of the Office of the Superintendent of Financial Institutions (OSFI) for a seven-year term as superintendent on June 29. He moves from his current post as chief executive of the Canada Deposit Insurance Corp., after a stint at the federal Finance Department and a Bay Street career analyzing and rating large Canadian banks and other institutions.

He succeeds Jeremy Rudin, who has led the regulator since 2014 and will step down when his term ends on Monday.

Mr. Routledge possesses a wonkish familiarity with the inner workings of the capital and liquidity rules that form the backbone of regulation for Canada’s financial sector. One of his first big decisions will be when to lift temporary restrictions on dividend payouts and share buybacks

BIDEN OUSTS HOUSING FINANCE CHIEF AFTER U.S. SUPREME COURT RULING

Reuters - Lawrence Hurley (2021-06-24)

President Joe Biden on Wednesday fired the head of the Federal Housing Finance Agency who had been appointed by his predecessor Donald Trump, acting hours after the U.S. Supreme Court expanded presidential powers to make it easier to oust the agency chief.

CANADA PENSION PLAN NOT PAYING FULL BENEFITS TO RECENT RETIREES DUE TO SYSTEMS DELAY

G&M - Rob Carrick (2021-06-23)

A small piece of your monthly Canada Pension Plan benefit is missing if you retired recently and chose to start payments immediately rather than delay them.

EX-DEPUTY GOVERNOR WARNS BANK OF CANADA AGAINST ‘MISSION CREEP’

G&M - Mark Rendell (2021-06-23)

Former Bank of Canada deputy governor John Murray is cautioning the central bank against “mission creep” as it moves into the final months of a major review of its monetary policy framework.

EU WATCHDOG TELLS BANKS TO HAVE A 10-YEAR CLIMATE PLAN

Reuters - Huw Jones (2021-06-23)

Banks in the European Union must have a 10-year plan spelling out how they will deal with environmental, social and governance (ESG) risks to their bottom line, the bloc's banking watchdog said on Wednesday.

INFLATION OVERSHOOT HAS BANK OF CANADA WEIGHING MANDATE TWEAKS

Bloomberg - Shelly Hagan (2021-06-23)

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CRA AUDITS OF ULTRA-WEALTHY CANADIANS YIELD ZERO PROSECUTIONS

Investment Executive - Christopher Reynolds (2021-06-23)

Green said federal authorities avoid pursuing Canada’s biggest tax cheats but go after small business owners who don’t pay their taxes under a “two-tiered system” pocked with “loopholes.”

BOC'S MACKLEM, LEADER OF AN ALL-MALE POLICY COMMITTEE, PROMISES TO 'ACCELERATE PROGRESS' ON DIVERSITY

FP - Kevin Carmichael (2021-06-22)

Carolyn Wilkins, the first and only woman to serve as senior deputy governor of the Bank of Canada, begins a three-year stint as one of five external members of the Bank of England’s Financial Policy Committee (FPC) this week.

INVESTORS FOCUS ON CENTRAL BANK SPEAKERS AFTER EXTREME MARKET MOVES

Reuters - Lewis KrauskopfKate DuguidSaqib Ahmed (2021-06-22)

With all eyes on the U.S. central bank this week, some investors are looking to a parade of Federal Reserve speakers to calm market volatility, saying the reaction to the Fed's June meeting was too extreme.

CANADIAN ECONOMIC CLIFF AT THE END OF PANDEMIC SUPPORT IS UNLIKELY: NATIONAL BANK

Better Dwelling - Daniel Wong (2021-06-22)

Many of the generous supports Canada extended during the pandemic are coming to an end. Amongst them, the bank highlights two of the biggest: the Emergency Wage Subsidy, which ends in June; and the Canada Recovery Benefit, which ends in September. Unless extensions are announced, many fear this can be a setback to the recovery. The NBC analysts don’t see it that way.

EQUIVALENCE HOPES FADE AS EU SLAMS UK’S LACK OF COMMITMENT

Bobsguide - Bobsguide (2021-06-22)

“The first path is deciding to work together, with the United Kingdom abiding by its obligations and engaging in good faith. And the second path, is if the United Kingdom continues to act on a unilateral basis.”

BIDEN WILL MEET U.S. FINANCIAL REGULATORS ON MONDAY

Reuters - Reuters (2021-06-21)

President Joe Biden will meet with financial regulators on Monday for an update on the country's financial systems and institutions, press secretary Jen Psaki said on Friday.

FED-FUELED DOLLAR RISES AS BEARS MAKE FOR EXITS

Reuters - Saqib Iqbal AhmedJulien Ponthu (2021-06-21)

The dollar index , which tracks the greenback against six major currencies, was up 0.37% at 92.213, its highest since mid-April. That puts the index on pace for a weekly gain of nearly 2%, its best weekly jump in about 14 months.

BOJ MAY KICK OFF DEBATE AROUND 2023 ON ENDING NEGATIVE RATES - EX-C.BANK EXEC

Reuters - Reuters (2021-06-17)

The Bank of Japan may start debating ways to phase out its extraordinary stimulus programme, such as by ditching negative interest rates, around the time Governor Haruhiko Kuroda's term ends in 2023, said former central bank executive Eiji Maeda.

OPENING STATEMENT BEFORE THE STANDING SENATE COMMITTEE ON BANKING, TRADE AND COMMERCE

BOC - Tiff Macklem (2021-06-17)

Looking more broadly at the economy as a whole, we forecast strong consumption-led growth in the second half of this year as vaccinations progress further and restrictions ease. Fiscal stimulus from the federal and provincial governments will also make an important contribution to growth. Strong foreign demand and higher commodity prices are expected to drive exports and business investment, leading to a more broad-based recovery. In our April MPR, we projected that the economy will grow by around 6½ percent this year, about 3¾ percent in 2022 and 3¼ percent in 2023.

CANADA’S BANKING REGULATOR BOOSTING KEY CAPITAL RESERVE THRESHOLD ABOVE PREPANDEMIC LEVELS

G&M - James Bradshaw (2021-06-17)

Canada’s banking regulator is raising a key threshold for banks’ capital reserves higher than prepandemic levels, rebuilding a buffer that was used to guard against stress in the financial system from the current crisis.

FED EXPECTED TO SIGNAL START OF MONETARY POLICY SHIFT DEBATE

Reuters - Howard Schneider (2021-06-16)

With U.S. inflation rising faster than expected and the economy forecast to grow at its quickest pace in decades this year, some policymakers have begun questioning whether the Fed should continue to keep its benchmark short-term interest rate near zero and leave unchanged a massive bond-buying program put in place to stem the economic fallout from the pandemic.

BRITAIN URGES EU TO EXPEDITE FINANCIAL SERVICES TALKS

Reuters - Huw Jones (2021-06-16)

Britain's finance ministry called on the European Union to open talks on financial services, after the London Stock Exchange on Tuesday urged the bloc to avoid protectionism.

KEY QUESTIONS ABOUT CANADIAN MONETARY POLICY ARE CAUSING CONCERN

G&M - STEVE AMBLER, JEREMY KRONICK, AND WILLIAM B.P. ROBSON (2021-06-15)

Some indicators, however, are less reassuring. Some of the bank’s own “core” inflation measures, which strip out volatile CPI components such as gasoline and food, are also running above 2 per cent. The bank highlights six on its website: CPI-trim, CPI-median, CPI-common, CPIX, CPI-XFET and CPIW. Each has its advantages and disadvantages, but each is meant to get at inflation’s underlying trend, discounting short-term volatility. Hence, the bank can better set monetary policy with an eye toward the medium-term horizon of six to eight quarters, at which point the bank expects inflation to be at the 2-per-cent target.

DELICATE TASK FOR FED: DECIDING WHEN TO PULL BACK ON LOW RATE SUPPORT

Investment Executive - Christopher Rugaber (2021-06-15)

Powell said at the time that he would want to see a “string” of hiring reports showing about 1 million added jobs each month. The job market has yet to reach that total in any month this year, though employers have posted a record-high number of open jobs.

GOVERNOR BAILEY ENCOURAGED BY PROGRESS AROUND ‘CRITICAL INNOVATION’ OF CBDC

Finextra - Finextra (2021-06-14)

“As a central bank we've always recognised the importance of innovation for the global financial system, and we look to support it wherever possible in the safest manner. Of course, the private sector can create technological and commercial innovation, it is a comparative advantage and expertise. But in the public sector, we have a very vital role in enabling and channelling its development so that it can provide efficient but also safe finance for consumers and businesses across the country.”

AMERICAN BANKING LOBBY HITS OUT AT CBDC HYPE

Finextra - Finextra (2021-06-14)

In a statement for the record of a Senate Banking subcommittee hearing, ABA notes that choosing between the various CBDC designs requires “serious and complex policy tradeoffs” and that too often CBDC proponents take a “highlight reel” approach to describing CBDC, “cherry picking all the perceived benefits, while downplaying the serious risks to consumers and our financial system.”

CETA TAKES CENTRE STAGE AT LATEST CANADA, EU SUMMIT

G&M - Andrew Hammond (2021-06-14)

The European Union and Canada are holding a summit in Brussels on Monday and Tuesday, with Prime Minister Justin Trudeau meeting EU counterparts after the NATO and G7 meetings. Centre stage in the discussion is the landmark bilateral trade agreement, the Comprehensive Economic and Trade Agreement, or CETA, which has driven an increase in two-way commerce, including a 15-per-cent boost in EU exports to Canada in 2020 alone.

WHAT'S AT STAKE FOR MARKETS AS DEBT CEILING LOOMS

Reuters - GERTRUDE CHAVEZ-DREYFUSS (2021-06-14)

The debt ceiling is the maximum amount the U.S. government can borrow, as directed by Congress, to meet its financial obligations. When the ceiling is reached, the Treasury cannot issue any more bills, bonds, or notes. It can only pay bills through tax revenues.

IMF SEES LEGAL, ECONOMIC ISSUES WITH EL SALVADOR'S BITCOIN MOVE

Reuters - Rodrigo CamposKarin Strohecker (2021-06-11)

The International Monetary Fund said on Thursday it has economic and legal concerns regarding the move by El Salvador to make bitcoin a parallel legal tender, further clouding the outlook for an IMF-backed program and widening spreads on the country's bonds.

BANK OF CANADA KEEPS IGNORING THE RAGING CANADIAN DOLLAR - WHICH MIGHT BE THE BEST STRATEGY

G&M - G&M (2021-06-10)

The Bank of Canada seems pretty intent on ignoring, as much as possible, the raging Canadian dollar. In most instances, that would be a bad idea. In the current circumstances, it may be good policy.

LAWMAKERS AREN’T READY TO RUBBER-STAMP FED DIGITAL DOLLAR

American Banker - Hannah Lang (2021-06-10)

The Federal Reserve has indicated it would need congressional help if the central bank moves ahead with a plan to create a digital dollar. But lawmakers aren't yet ready to give their stamp of approval.
At a hearing Wednesday, Senate Banking Committee members raised questions about how a Fed-designed digital currency would be structured, how it would complement the private sector and whether a digital dollar is even necessary, among other concerns.

INVESTORS SEEK CLUES ON BANK OF CANADA’S NEXT TAPER: DECISION GUIDE

Bloomberg - Shelly Hagan (2021-06-09)

Investors will be looking for fresh hints from the Bank of Canada this week on its next move to reduce emergency levels of monetary stimulus.

PARIS AND BERLIN LEAD FIGHT TO DILUTE BRUSSELS’ STRICTER BANK CAPITAL RULES

FT - Sam Fleming, Martin Arnold (2021-06-09)

Jörg Kukies, deputy finance minister of Germany, told the Financial Times that the Franco-German proposal was “a pragmatic way of ensuring a truthful and compliant Basel implementation on the one hand and respecting the political mandate of [the EU’s economic and financial affairs council] and G20 for no significant increase in capital requirements as well”.

CLIMATE LOOMS LARGE FOR INCOMING HEAD OF OSFI

G&M - Jeffrey Jones (2021-06-07)

Canada will soon have a new top financial watchdog and the successful candidate will be more of a climate cop than ever before.

MAJOR G7 TAX AGREEMENT ONLY FIRST STEP TOWARD GLOBAL DEAL: FREELAND

CBC - Christian Paas-Lang (2021-06-07)

Finance Minister Chrystia Freeland said Saturday an agreement made by Group of Seven (G7) countries on taxing multinational companies and setting a global minimum corporate tax rate was just a first step toward a global deal.

CHRYSTIA FREELAND HAS THE BLUEPRINT TO REVOLUTIONIZE CANADIAN BANKING — SO LET'S USE IT

FP - Kevin Carmichael (2021-06-07)

The policy is known as “open banking” and it could provide a competitive shock to a banking system whose idea of competition is engaging in price wars over the issuance of government-backed mortgages. The review has been so slow in coming to what many say are foregone conclusions that some have wondered if the big banks are doing their best to stand in the way of progress. Whatever the reason for the slow going, any delay from this point on will have everything to do with Freeland herself, as she now has all the information and context that she needs.

SEC REMOVES CHAIRMAN OF AUDIT WATCHDOG

WSJ - Mark Maurer (2021-06-07)

The PCAOB regulates the audits of publicly traded companies. Congress established it with the Sarbanes-Oxley Act of 2002 following accounting scandals at Enron Corp. and other now-defunct firms. Mr. Duhnke was sworn in as PCAOB chairman in January 2018 under then-President Donald Trump.

G7 FINANCE MINISTERS MEET IN LONDON TO BROKER GLOBAL TAX DEAL

Reuters - David Milliken (2021-06-04)

Finance ministers from the G7 group of rich nations are meeting in London on Friday for two days of talks aimed at moving closer to a global deal to raise more tax from the likes of Google, Facebook and Amazon.

SAUDI ARAMCO IN TALKS WITH BANKS FOR NEW BOND SALE - SOURCES

Reuters - Staff (2021-06-03)

Saudi Arabian oil group Aramco (2222.SE) is in talks with banks for a U.S. dollar-denominated bond issue, two sources said, seeking to raise money ahead of large commitments for its major shareholder, the Saudi government.

FED EXITS THE CREDIT MARKET IT CHANGED FOREVER

Bloomberg - Brian Chappatta (2021-06-03)

It’s not exactly tapering, but the Federal Reserve is starting the clock on withdrawing the emergency measures it used to support financial markets during the Covid-19 pandemic.

CHINA'S BANKS ARE BURSTING WITH DOLLARS, AND THAT'S A WORRY

Reuters - Tom WestbrookWinni Zhou (2021-06-02)

A mountain of dollars on deposit in China has grown so large that banks are struggling to loan the currency and traders say it poses a risk to official efforts to control a fast-rising yuan.

END OF AN ERA AS POLOZ EXITS BANK OF CANADA

G&M - DAVID PARKINSON (2021-06-01)

Stephen Poloz had only been Governor of the Bank of Canada for a few months in the late summer of 2013, when he gave a speech that defined his unique communication style and signalled a new era for a traditionally staid institution.

PIERRE POILIEVRE VS MARK CARNEY: A HEATED EXCHANGE ON PIPELINES

FP - Staff (2021-05-31)

Carney, who led the Bank of Canada from 2008 and 2013 and the Bank of England from 2013 to 2020, advised the Liberal federal government on its latest budget and is widely considered to have political aspirations to run for the Liberal party.

AUSTRALIA CENTRAL BANK FACES TAPER PRESSURE AS MORE PEERS SHIFT

Bloomberg - Michael Heath (2021-05-31)

Australia’s central bank is approaching a decision on whether the economy is strong enough for it to join Canada and New Zealand in signaling a move away from emergency mode.

FINANCE DEPARTMENT REPORTS PRELIMINARY DEFICIT OF $314B FOR LAST FISCAL YEAR

Investment Executive - CP (2021-05-31)

The early deficit figure for the 12-month period between April 2020 to March 2021 compares to a deficit of $21.8 billion over the preceding fiscal year.

BANK OF CANADA HAS NO PLANS FOR DIGITAL LOONIE, SAYS DEPUTY TIMOTHY LANE

G&M - Ian McGugan (2021-05-27)

The Bank of Canada is closely monitoring the rise of cryptocurrencies and other digital forms of cash, but has no plans at the moment to launch its own digital loonie, a deputy governor said Wednesday.

WORK ON DIGITAL CURRENCY WELL UNDERWAY, BUT NO NEED TO ISSUE IT JUST YET: BANK OF CANADA

FP - Julie Gordon (2021-05-27)

The Bank of Canada is thinking in more concrete terms about how its digital currency might look and work but it does not currently see a strong case for issuing one, a deputy governor said on Wednesday.

OTTAWA’S DEMAND-HEAVY STIMULUS PLAN POSES PROBLEMS FOR CANADA’S ECONOMY

G&M - Sean Kilpatrick (2021-05-26)

The budget and its stimulus plan certainly didn’t ignore measures to fuel growth in labour supply (most notably, the national child care plan) and small-business investment and innovation (such as the Canada Digital Adoption Program). But the vast bulk of spending in the package over the next year continues to be targeted at wage subsidies and income supports for workers and employers hit by COVID-19 shutdowns and restrictions. The effect of these programs is, ultimately, to keep money flowing into consumers’ pockets – which keeps consumer demand humming.

THE BANK OF CANADA IS TRYING TO GO GREEN

FP - Kevin Carmichael (2021-05-26)

The Bank of Canada is also ramping up its research agenda. The FSR included the results of a deep study of natural disasters in Canada based on data that dates to 1900. Using artificial intelligence, the central bank determined that about 40 per cent of the country’s total household debt is held by households living in parts of the country that face “high exposure” to wildfires and other such catastrophes.

AS INTEREST RATES HIT BOTTOM, DEBT DOES MATTER, SAYS BARCLAYS

Reuters - SUJATA RAO (2021-05-26)

With global borrowing costs probably as low as they can go, high debt levels will start to matter more in coming years, a Barclays study found, highlighting Brazil as the country at greatest risk of a hit to growth and debt sustainability.

OSC BEGINS CRYPTO CRACKDOWN

Investment Executive - James Langton (2021-05-26)

The crackdown on unregulated crypto trading in Canada has begun, with the Ontario Securities Commission (OSC) bringing allegations against a Seychelles-based firm for failing to heed the regulator’s warning to get registered.

BANK OF CANADA REMINDS US OF MORE THINGS TO WORRY ABOUT

CBC - Don Pittis (2021-05-25)

That's why the first and biggest risk outlined by the bank in its report was "a large decline in household income and house prices" caused by an external trigger event. It is hard to be sure what form such a trigger event could take. Macklem referred at one point to a "sharp repricing of risk." Such an event might lead to, say, a sudden rise in global interest rates, a stock market crash or a weakening of global trade. Maybe even the collapse of bitcoin.

THE BANK OF CANADA RELEASES THE FINANCIAL SYSTEM REVIEW

BOC - BOC (2021-05-20)

The Financial System Review (FSR) summarizes the Governing Council’s judgment on the main vulnerabilities and risks to the stability of the Canadian financial system and highlights the efforts of the Bank and other Canadian and international regulatory authorities to mitigate those risks. After a brief survey of macrofinancial conditions, the principal vulnerabilities and risks are examined.

BANK OF CANADA CALLS CRYPTO ASSETS AN EMERGING VULNERABILITY

Bloomberg - Erik Hertzberg (2021-05-20)

The Bank of Canada said volatility in cryptocurrency assets is an emerging vulnerability to the country’s financial system, a day after a major selloff in the sector.

THE BANK OF CANADA’S GOVERNING COUNCIL HAS A DIVERSITY PROBLEM, AND A GREAT OPPORTUNITY TO FIX IT

G&M - DAVID PARKINSON (2021-05-18)

When Bank of Canada Governor Tiff Macklem delivered a speech last week championing diversity and inclusion, he took a moment to deliver a mea culpa from the upper echelon of the central bank.

THE BANK OF CANADA, GOVERNED BY FIVE WHITE MEN, HAS A LONG WAY TO GO WITH MACKLEM NEWLY CHAMPIONING DIVERSITY

FP - Kevin Carmichael (2021-05-18)

The title of his remarks was “Including everyone helps us all.” Macklem talked about the importance of diversity, noting that research on the question is settled: strategy and decisions made by leadership teams that feature women, racialized individuals, and disabled people do better than C-suites and boards of directors that are dominated by white men. “Diverse and inclusive groups make better decisions,” Macklem said. “That’s because they can avoid groupthink that happens when decision-makers all have similar backgrounds and approach problems the same way.”

BANK OF CANADA SAYS QE CAN WIDEN WEALTH INEQUALITY, IS PROBING ITS EFFECTS

FP - Julie Gordon and David Ljunggren (2021-05-18)

The Bank of Canada said on Thursday that some of the monetary policy tools it is using to address the COVID-19 pandemic, such as quantitative easing (QE), could widen wealth inequality and that it was looking closely at the issue.

THE BANK OF CANADA RELEASES THE FINANCIAL SYSTEM REVIEW

BOC - BOC (2021-05-17)

The Financial System Review will be released on Thursday, May 20, 2021. The Financial System Review (FSR) summarizes the Governing Council’s judgment on the main vulnerabilities and risks to the stability of the Canadian financial system and highlights the efforts of the Bank and other Canadian and international regulatory authorities to mitigate those risks. After a brief survey of macrofinancial conditions, the principal vulnerabilities and risks are examined.

BAILEY: COMBINATION OF REFORMS NEEDED TO TACKLE ‘DANGEROUS’ MONEY MARKET FUNDS

Bobsguide - Tom Lemmon (2021-05-13)

Bank of England governor Andrew Bailey has said that money market funds (MMFs) proved in the early stages of the pandemic that they were “not sufficiently resilient”. That is despite efforts to increase the stability of MMFs after their involvement in the demise of Lehman Brothers and the crash in 2008.

INCLUDING EVERYONE HELPS ALL OF US

BOC - Tiff Macklem (2021-05-13)

Diversity and inclusion are core to our success as a central bank that serves all Canadians.

CHRYSTIA FREELAND DEFENDS WAGE SUBSIDY AS OPPOSITION ACCUSES LIBERALS OF ‘SHOWERING THEIR RICH BAY STREET FRIENDS’

G&M - BILL CURRY AND PATRICK BRETHOUR (2021-05-12)

Conservative and NDP MPs questioned the minister about a Globe and Mail investigation, which found that hundreds of publicly traded companies, or their wholly owned subsidiaries, together received at least $3.6-billion in Canada Emergency Wage Subsidy payments as of late January. Among those companies were some of the biggest names in corporate Canada, as well as dozens of hedge funds and wealth managers.

PLAYING CATCH-UP ON SUSTAINABLE FINANCE, OTTAWA STRIKES NEW ‘ACTION COUNCIL’

G&M - Adam Radwanski (2021-05-12)

The federal government is set to launch a public-private advisory body aimed at accelerating the adoption of sustainable-finance measures, on which Canada risks lagging behind its trading partners.

FORMER UK PM CAMERON DETAILS EXTENSIVE GREENSILL LOBBYING

Reuters - Reuters (2021-05-12)

Former British Prime Minister David Cameron repeatedly contacted senior ministers over a four-month period in 2020 to lobby for the now-failed, supply-chain finance firm Greensill Capital, according to documents published on Tuesday.

CARNEY URGES LIBRA-LIKE RESERVE CURRENCY TO END DOLLAR DOMINANCE

Bloomberg - Brian Swint (2021-05-12)

BIG BANKS ON DEFENSE AFTER FED SIDES WITH RETAILERS ON DEBIT SWIPE FEES

American Banker - Brendan Pedersen, Kevin Wack (2021-05-12)

For nearly a decade, the Federal Reserve avoided choosing sides in the protracted, high-stakes dispute between banks and retailers over debit card fees.

HOW MALAYSIA IS SEEKING TO RECOVER BILLIONS OF DOLLARS MISSING FROM 1MDB

Reuters - Reuters (2021-05-11)

1MDB raised billions of dollars in bonds, ostensibly for investment projects and joint ventures, between 2009 and 2013.

CANADA KICKS OFF ITS FIRST U.S. DOLLAR BOND SALE SINCE PANDEMIC

Bloomberg - Esteban Duarte (2021-05-11)

The North American country plans to sell five-year bonds in the first benchmark-sized transaction in the currency since January 2020, Bloomberg data show. The bonds, which are expected to be priced Tuesday, are being marketed at around 8 basis points over U.S. Treasuries, according to people familiar with the matter.

LESSONS FROM 2009 HELPED BOC AVOID LIQUIDITY STRESS IN 2020

Investment Executive - James Langton (2021-05-10)

The central bank published a paper examining the operation of Canada’s electronic funds transfer system for large payments, the Large Value Transfer System (LVTS), during the pandemic.

FEDERAL BUDGET DEBT BURDEN PROJECTIONS RELY ON ROSY ASSUMPTIONS

G&M - Patrick Brethour (2021-05-07)

But that comforting scenario rests on some optimistic to highly optimistic long-term assumptions about productivity growth, economic expansion, interest rates and inflation. If all of those factors don’t turn out as favourably as the Finance department is forecasting, then that steady march to stability could instead turn into a permanently elevated debt burden – or even an upward spiral.

LIBERAL BUDGET UNDERESTIMATES SIZE OF FEDERAL DEFICITS, WILL LEAD TO DECADES OF HIGHER DEBT: PBO

G&M - Bill Curry (2021-05-06)

The Liberal government’s 2021 budget underestimates the likely size of federal deficits by about $5.6-billion a year and puts Ottawa on a long-term path of higher debt, says Parliamentary Budget Officer Yves Giroux.

INFLATION IS MORE OF A THREAT THAN THE FED SAYS

WSJ - Opinion (2021-05-05)

Regarding Mickey D. Levy and Michael D. Bordo’s “The Fed in the Sand as Inflation Threatens” (op-ed, April 27): I have been calling on Fed Chairman Jerome Powell to release his plan to curb the effects of inflation for several months. Last month, I finally heard back from him. He told me that he doesn’t want inflation that substantially exceeds 2%, or inflation for a prolonged period.

JANET YELLEN JUST SAID INTEREST RATES MAY NEED TO RISE TO PREVENT THE ECONOMY OVERHEATING AMID STIMULUS

FP - Ann Saphir and Dan Burns (2021-05-05)

Overall the programs, which include stepped-up spending on infrastructure, childcare and education, will make a “big difference” to inequality, Yellen said.

YELLEN CLARIFIES INFLATION REMARK, SEES NO NEED FOR FED TO HIKE

Bloomberg - Christopher Condon and Saleha Mohsin (2021-05-05)

Discover what’s driving the global economy and what it means for policy makers, businesses, investors and you with The New Economy Daily. Sign up here

THE FED BOARD AGREES NEVER TO DISAGREE

WSJ - Judy Shelton (2021-05-05)

In the aftermath of an economic and financial challenge that Federal Reserve Chairman Jerome Powell recently likened to Dunkirk—the urgent rescue of British and other Allied troops from France in World War II—there’s a remarkable uniformity of opinion on the Federal Reserve Board of Governors. Apparently, they all agree on the appropriateness of the Fed’s monetary-policy decisions. That’s what worries me.

HOW DEFERRING THE OAS JUST GOT A LITTLE MORE LUCRATIVE

G&M - Patrick Brethour (2021-05-04)

In 2015, the federal Liberal platform committed the party to reversing a Conservative plan to gradually raise the retirement age (or at least the eligibility age for Old Age Security payments) to 67 from 65, arguing that seniors needed the money more than Ottawa.

THE BANK OF CANADA MIGHT HAVE TO TIGHTEN ITS MESSAGING TO ALLAY WORRIES ABOUT INFLATION

FP - Kevin Carmichael (2021-05-04)

“I would say, ‘Governor, I’m sure glad we’re learning from the lessons of history,’” Easter, a Liberal, said during Macklem’s testimony at his committee on April 27. “I’m one, and there may be others on this committee, who faced a 23-per-cent interest rate in the 1980s and I’ll tell you we paid for that for a very long time.”

BANK OF CANADA IS “DISCREDITING” ITS OWN INFLATION RESEARCH, PUZZLING ECONOMISTS

Better Dwelling - Stephen Punwasi (2021-05-04)

The BoC’s April Monetary Policy Review (MPR) said inflation data would be unreliable. More specifically, the three measures — CPI-trim, CPI-median, and CPI-common would be unreliable. Arseneau says, “last week’s imbroglio [embarrassing situation] over inflation in Canada comes at a bad time.”

THE BANK OF CANADA MIGHT HAVE TO TIGHTEN ITS MESSAGING TO ALLAY WORRIES ABOUT INFLATION

FP - Kevin Carmichael (2021-05-03)

The combination of the Bank of Canada’s loose monetary policy and the federal government’s massive spending is a necessary response to an epic catastrophe. There’s an echo of the 1960s and 1970s, a period that inspired the music of Leonard Cohen, Joni Mitchell and Neil Young, but ended in one of the worst recessions in Canadian history.

DAVID DODGE’S BIG ISSUE WITH THE BUDGET ISN’T DEBT, BUT LACK OF GROWTH

G&M - DAVID PARKINSON (2021-04-29)

David Dodge has had a few days to take a look at the budget that the federal Liberal government unveiled last week. He’s not a fan – of the math or the substance.

U.S. KEEPS ULTRA-LOW INTEREST RATE POLICIES IN PLACE, BUT NODS TO 'STRENGTHENED' RECOVERY

G&M - Reuters (2021-04-29)

"Amid progress on vaccinations and strong policy support, indicators of economic activity and employment have strengthened," the U.S. central bank said in a unanimous policy statement at the end of a two-day meeting.

FEDERAL PLEDGE TO PUBLICLY DISCLOSE WHO OWNS SOME PRIVATE COMPANIES CATCHES PROVINCES OFF-GUARD

CBC - Ivan Angelovski, Zach Dubinsky (2021-04-29)

That's been the case in British Columbia, where a government-commissioned report estimated money launderers parked $5.3 billion in real estate in 2018 alone — enough that it drove up housing prices by five per cent.

BANK OF CANADA UNFAZED BY SHORT-TERM INFLATION INCREASE

G&M - Mark Rendell (2021-04-28)

Bank of Canada Governor Tiff Macklem said the central bank is not concerned about a temporary spike in inflation that is expected to take Consumer Price Index growth to around 3 per cent in the coming months.

BANK OF CANADA JOINS VOLUNTARY INITIATIVE TO STUDY INDIGENOUS ECONOMIC ISSUES

G&M - MARK RENDELL AND WENDY STUECK (2021-04-28)

The Bank of Canada is looking to improve how it researches and analyzes economic issues relating to Indigenous communities as part of a joint initiative with the central banks of New Zealand and Australia.

BANKING REGULATOR TO SHIFT FOCUS TO TECHNOLOGY, CLIMATE RISKS

G&M - James Bradshaw (2021-04-28)

New threats that increasingly keep banking regulators up at night present a fresh set of challenges because they fall outside the traditional boundaries of financial risk management. They include global threats such as climate change, fast-moving innovations in technology and cybersecurity and the emergence of new asset classes such as crypto assets – an uncharted and largely unregulated area for financial institutions that is “growing in importance,” Mr. Gully said.

CANADA AVOIDS ELECTION WITH LAWMAKERS BACKING TRUDEAU BUDGET

Bloomberg - Kait Bolongaro (2021-04-27)

In a Monday evening vote, lawmakers from the New Democratic Party backed Finance Minister Chrystia Freeland’s plan to help the Canadian economy recover from its pandemic-induced losses. The vote in the House of Commons was 178 to 157 in favor.

INFLATION FORCES THE BANK OF CANADA’S HAND AHEAD OF FED AND ECB

Bloomberg - Theophilos Argitis and Ye Xie (2021-04-23)

In a surprise move, it accelerated the timetable for a possible interest-rate increase and began paring back its bond purchases on Wednesday. That made Canada the first major economy to signal its intent to reduce emergency levels of monetary stimulus.

WITH NEW PROJECTIONS, BANK OF CANADA SIGNALS IT’S WILLING TO BE FLEXIBLE ON INFLATION TARGET IN PURSUIT OF FULL RECOVERY

G&M - DAVID PARKINSON (2021-04-22)

Canada’s inflation-targeting central bank just acknowledged that inflation is headed above its 2-per-cent target in the post-COVID-19 recovery. And you know what? It’s okay with that.

BANK OF CANADA OFFERS FRESH HINTS THAT INTEREST RATES WILL RISE NEXT YEAR AS ECONOMY SURGES

CBC - Don Pittis (2021-04-22)

New signs of a strong recovery — including the bank's prediction of a stunning global growth rate of nearly seven per cent this year — plus indications that the underlying foundation of the Canadian economy has not suffered serious damage from the COVID-19 pandemic, mean the central bank is scaling back on monetary stimulus.

CENTRAL BANKS AND GOVERNMENT OUT OF TOUCH WITH MAIN STREET WHEN IT COMES TO RISING COST OF LIVING

FP - Martin Pelletier (2021-04-22)

Nothing makes our central bankers, academics and government officials sound more out of touch with Main Street these days than when they talk about low levels of inflation. The problem is that ultra-low interest rate policies justified by CPI tracking don’t seem to help much when income levels are stagnating and asset prices are surging.

BANK OF ENGLAND SEES POTENTIAL RISKS FROM CLOUD DATA PROVIDERS

Reuters - Reuters (2021-04-22)

CANADIAN DOLLAR JUMPS MOST IN 10 MONTHS ON ASSET PURCHASE CUTS

Bloomberg - Susanne Barton (2021-04-22)

“I thought the bank might try to complain about or argue against CAD strength -- it didn’t,” Anderson said. “The bank merely made the factual statement that CAD had rallied alongside commodity prices. Based on that, I’m slightly less worried about the BOC trying to push back against CAD strength in the future.”

BUDGET 2021 IS A VOTE-BUYING MULTIYEAR MASSIVE SPENDING BINGE THAT CANADA IS UNLIKELY TO AFFORD

G&M - David Rosenberg (2021-04-21)

There was a time in this fair land when a federal budget was an economics document. These days, it is a social policy document aimed to buy votes. It’s actually quite sad.

BANK OF ENGLAND SEES POTENTIAL RISKS FROM CLOUD DATA PROVIDERS

Reuters - Reuters (2021-04-21)

THE U.S. HAS A CLEAR WARNING FOR EMERGING MARKETS

Bloomberg - Daniel Moss (2021-04-21)

The Treasury Department has a warning for the emerging world: The export-your-way-to-prosperity template has fallen out of favor. Once thought to be in U.S. interests — as a way of getting plentiful cheap goods — this model of development is now meeting more skepticism. The message for Asia should be loud and clear, even if some economies got a pass last week. 

FEDERAL BUDGET 2021: LIBERALS’ FISCAL ANCHOR BANKS ON RAPID PANDEMIC RECOVERY

G&M - Mark Rendell (2021-04-20)

The federal government is pinning its new “fiscal anchor” to a rapid postpandemic recovery, with economic growth expected to put the government’s debt-to-GDP ratio on a downward trajectory over the next few years, despite continuing deficits.

Ottawa added more than $350-billion to its accumulated debt last year, and expects to run another deficit of $154.7-billion this year. Federal debt now stands at $1.08-trillion or 49 per cent of GDP, up from $721-billion or 31.2 per cent before the pandemic.

Heading into Monday’s budget,

CENTRAL BANKS TO POUR MONEY INTO ECONOMY DESPITE SHARP REBOUND

Bloomberg - Bloomberg (2021-04-20)

The outlook suggests officials still want to guarantee the recovery from last year’s coronavirus recession by maintaining ultra-low borrowing costs and asset-buying programs. That may require them to accept any accompanying bounce in inflation.

HOW THE CANADIAN GOVERNMENT’S SUPERSIZED BUDGETS INFLATE THE PROPERTY BUBBLE

Better Dwelling - Stephen Punwasi (2021-04-20)

Canadian real estate prices are rising at rates even the banks are warning about. There’s a lot of reasons this is happening, but one rarely discussed is the supersized borrowing from the Government of Canada (GoC). A lot of cash was needed during the pandemic, but Canada’s discretionary spending topped the G20. To help facilitate this spending, the Bank of Canada (BoC) made use of quantitative ease (QE). The unconventional policy tool’s use is debated, but its impact is well established.

IF I WERE FINANCE MINISTER ...

FP - Jack M. Mintz (2021-04-19)

If I were finance minister, I’d be asking myself the following question: With a recovery just getting going following a deep recession, should I act like Marc Lalonde in 1983 or Paul Martin in 1994? Or should I chart my own course?

TRUDEAU WILL ADD TO RECORD DEBT WITH FIRST PANDEMIC BUDGET

Bloomberg - Kait Bolongaro and Theophilos Argitis (2021-04-19)

Justin Trudeau is set to unveil a vision for Canada’s post-pandemic recovery that will double as an election platform, heavy on new spending and assurances the mounting debt is affordable.

CANADA’S ANTI-MONEY LAUNDERING AGENCY STRUGGLES TO IMPLEMENT REFORMS AS EMPLOYEES WORK FROM HOME

G&M - Vanmala Subramaniam (2021-04-15)

Internal documents from the Financial Transactions and Reports Analysis Centre of Canada (FinTRAC) obtained through freedom of information legislation paint a picture of substantial disruption at the agency, especially in the first few months of the pandemic, when hundreds of employees were abruptly forced to work from home.

CENTRAL BANKING’S GREEN LIMITS SPARK LEGAL DEBATE IN SWEDEN

Bloomberg - Bloomberg (2021-04-15)

How should a central bank respond to global warming? In Sweden, a body created to monitor government efforts to fight climate change says the law that guides monetary policy needs a serious overhaul.

BIDEN IMPOSES TOUGH NEW SANCTIONS ON MOSCOW

FT - Henry Foy, Katrina Manson, Michael Peel (2021-04-15)

On Wednesday, the US for the first time formally blamed SVR, Russia’s foreign intelligence service, for the SolarWinds hack, which affected at least nine federal agencies and 100 companies. One senior administration official told reporters the hack gave Russia “the ability to spy on or potentially disrupt more than 16,000 computer systems worldwide”.

FED’S POWELL SAYS U.S. ECONOMY AT AN 'INFLECTION POINT'

G&M - Reuters Video (2021-04-13)

According to Federal Reserve Chair Jerome Powell, the U.S. economy is at an "inflection point" with expectations that growth and hiring will pick up speed in the months ahead, but some risks remain, particularly any resurgence in the coronavirus pandemic.

EUROPE IS HEADING TOWARD A NEW FINANCIAL CRISIS

Bloomberg - Editorial Board (2021-04-12)

Europe faces a predicament. Even as it struggles to contain the Covid-19 pandemic, it’s setting itself up for another crisis — this one financial. To ensure the viability of the common currency at the heart of the European project, the EU’s leaders will have to cooperate in ways they’ve so far resisted.

ZIMBABWE PRESIDENT WARNS OF CRACKDOWN ON FINANCIAL INDUSTRY

Bloomberg - Ray Zdlovu (2021-04-12)

Mnangagwa has previously issued warnings to private companies he blames for undermining his efforts to turn around an economy plagued by annual inflation of 241% and foreign-currency shortages. Last year, his government closed the Zimbabwe Stock Exchange for five weeks and singled out the largest mobile operator, Econet Wireless Zimbabwe Ltd., for undermining the nation’s currency through its mobile money service

BANK OF CANADA RELEASES RESULTS FROM CONSULTATIONS ON INFLATION AND MONETARY POLICY

BOC - BOC (2021-04-12)

Most respondents also said they would prefer an approach that balances the level of interest rates to benefit both savers and borrowers. Additionally, the majority viewed inflation targeting as the most easily understood approach.

INTRODUCTORY REMARKS BY SUPERINTENDENT JEREMY RUDIN AT TORYS LLP ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) SESSION VIA WEBCAST, APRIL 7, 2021

OSFI - OSFI (2021-04-12)

For OSFI, our focus in these matters is prudential. That is to say that our unique role is to ensure that Canadians continue to enjoy financial stability as climate-related risks manifest themselves. This is a very important role, and one that we take very seriously, especially as we are the only arm of the Government of Canada that is equipped to meet this prudential responsibility.

WHATEVER WE MAY THINK OF MODERN MONETARY THEORY, ITS DAY IN THE SUN HAS ARRIVED

G&M - DAVID PARKINSON (2021-04-12)

Last fall, as Chrystia Freeland began laying the groundwork for a postpandemic recovery strategy that would heap more debt onto the federal government’s already immense pile, she felt obliged to assure Canadians that, no, she hasn’t invited a three-initialled economic bogeyman to live under our bed.

CAROLYN WILKINS APPOINTED TO BANK OF ENGLAND COMMITTEE OVERSEEING BRITAIN’S FINANCIAL STABILITY

G&M - Mark Rendell (2021-04-09)

Carolyn Wilkins, the former second-in-command at the Bank of Canada, has been appointed to the Bank of England committee that oversees financial stability in Britain.

FIGHTING THE COVID-19 PANDEMIC LED TO RISING NATIONAL DEBT. NOW WHAT?

WSJ - WSJ Video (2021-04-08)

The federal government has been borrowing a lot of money to fight the pandemic. But with national debt rising, lawmakers disagree on how to deal with that debt and pay for priorities going forward. WSJ’s Gerald F. Seib explains. Photo illustration: Emma Scott

BEWARE THE SIREN SONG OF MODERN MONETARY THEORY

FP - Mark Zelmer (2021-04-07)

The massive increase in government spending in Canada and around the world in response to the COVID-19 pandemic has been accompanied by a siren song in the form of a new economic theory: “Modern Monetary Theory,” or MMT for short. But as we begin to emerge from the acute phase of the pandemic we need to turn a deaf ear to that song. Now that inflation concerns are beginning to stir it is hard to imagine governments raising taxes or cutting spending anytime soon to keep inflation in check — yet that’s how MMT advocates would control inflation, with what traditionally have been regarded as fiscal policies rather than the customary monetary tools of interest rates and liquidity measures.

YELLEN GLOBAL MINIMUM TAX IS STEP TOO FAR IN D.C

Reuters - Gina Chon (2021-04-07)

That would put America’s headline rate above many Western nations. Biden’s blueprint also includes a minimum tax of 21% on the income U.S. companies earn on assets like patents and trademarks outside the United States, up from the current floor of around 10%.

SHUTTERING OF NATIONAL SECURITIES REGULATOR CAME AS NO SURPRISE TO INDUSTRY

Investment Executive - Rudy Mezzatta (2021-04-07)

Last week, the CMAIO, which was established in 2015 to guide the launch of a national capital markets regulatory authority, put its operations on pause and laid off its staff. The organization said that it could resume its work in the future “when there is greater certainty around cooperative system launch timelines.”

JANET YELLEN CALLS FOR GLOBAL MINIMUM CORPORATE TAX TO END '30-YEAR RACE TO THE BOTTOM'

FP - Reuters (2021-04-06)

Yellen said it was important to make sure governments “have stable tax systems that raise sufficient revenues in essential public goods and respond to crises, and that all citizens fairly share the burden of financing government.”

DON'T BE ALARMED AS THE BANK OF CANADA BEGINS ITS COVID WITHDRAWAL

FP - Steve Ambler, Jeremy M. Kronick and William B.P. Robson (2021-04-06)

On March 23, the Bank of Canada announced the upcoming suspension of some of its major asset-purchase programs. This is good news. Financial stresses at the beginning of the pandemic a year ago led the bank to buy the debt of provincial governments and private companies. Those stresses are now in the past and Canadians should welcome the bank’s retreat from a role fraught with economic and political risks.

FORMER CENTRAL BANK GOVERNOR TO PLAY PROMINENT ROLE AT LIBERAL CONVENTION

G&M - Joan Bryden (2021-04-05)

Mark Carney, long touted as a potential Liberal leader one day, will be a keynote speaker at the federal party’s convention later this week.

EXPECT TWEAKS NOT BIG CHANGES AS THE BANK OF CANADA GETS CLOSER TO NEW INTEREST RATE POLICY

FP - Kevin Carmichael (2021-04-01)

In 2019, the Reserve Bank of New Zealand, which in 1989 became the first central bank to adopt a formal inflation target, was told by Jacinda Ardern’s government to include “maximum sustainable employment” as an objective. Earlier this year, Ardern added “sustainable house prices, including dampening investor demand for existing housing” to governor Adrian Orr’s agenda.

BIDEN SAYS $2 TRILLION JOBS PLAN RIVALS THE SPACE RACE IN ITS AMBITION

Reuters - Steve Holland, Jarrett Renshaw (2021-04-01)

“It’s a once-in-a-generation investment in America, unlike anything we’ve seen or done since we built the interstate highway system and the space race decades ago,” Biden said in unveiling the program in Pittsburgh.

BANK OF CANADA GOVERNOR SEES ‘WORRYING’ SIGNS IN HOUSING MARKET

Bloomberg - Ari Altstedter and Erik Hertzberg (2021-04-01)

The Bank of Canada is seeing “worrying” signs that some Canadians are taking on too much debt to buy into the nation’s hot housing market.

COVID FELINE/CANINE TAX IN EFFECT JUNE 13 2021

BNTV - Poussin Boots (2021-03-31)

CIBC clients are exempt from the Covid-19 pet owners tax. In effect from March 31st, municipal authorities require Canadian's to adhere to strict lockdown measures with the excpetion of pet owner that must walk their pets regularly. Therefore, dog and cat owners have been exempt from curfews. Consequently, a Canadian pet owners will be required to pay a dog and cat tax that would require every cat owner in to pay $40 (about $35) a year. But fear not, because you get a cat licence, complete with a picture of your cat, to show the tax man that you and your kitty are law-abiding citizens. CIBC clients are exempt because they have decided to compensate clients that own pets.

BANKER WAS RECENTLY ARRESTED FOR BRIBING $100,000

G&M - Andrew Willis (2021-03-31)

The federal government and seven provinces and one territory are shutting down the organization charged with creating a national securities regulator due to waning political support for the project in jurisdictions such as Ontario and British Columbia.

FED OFFICIAL SAYS BANK WON’T KEEP INTEREST RATES LOW TO FUND FOR GOVERNMENT DEFICITS

G&M - Howard Schneider (2021-03-29)

The Federal Reserve won’t bend its interest rate or bond-buying policies to help finance the federal government’s rising deficits, Christopher Waller said on Monday in his debut speech as a member of the U.S. central bank’s board of governors.

‘ARE WE GOING TO BE ABLE TO PULL THIS OFF?’: HOW THE BANK OF CANADA DOUSED A FINANCIAL FIRE LAST SPRING

G&M - MARK RENDELL AND DAVID PARKINSON (2021-03-27)

It was Mar. 27, 2020, and the central bank had just unveiled a plan to buy Canadian government bonds at the astounding pace of at least $5-billion a week.

FREELAND SAYS FEDERAL BUDGET WILL BE TABLED APRIL 19

G&M - Bill Curry (2021-03-24)

Finance Minister Chrystia Freeland announced Tuesday that the next federal budget will be tabled on April 19.

BANK OF CANADA TO END PROVINCIAL, CORPORATE BOND BUYING PROGRAMS

G&M - Mark Rendell (2021-03-24)

In a speech on Tuesday, deputy bank governor Toni Gravelle said the central bank will let its commercial paper, provincial bond and corporate bond buying programs expire in the coming months, now that debt markets are functioning normally. It will also end two sales and repurchase agreement – or “repo” – programs launched last March to pump cash into financial institutions that faced a liquidity crunch early in the pandemic.

BANK OF CANADA WORKING HARD TO AVOID A TAPER TANTRUM WHEN IT EVENTUALLY SLOWS GOVERNMENT BOND PURCHASES

FP - Kevin Carmichael (2021-03-24)

“I want to be clear here: moderating the pace of purchases while adding to our holdings would simply mean that we are still adding stimulus through QE, but at a slower pace,” Gravelle said. “It would not mean we are removing stimulus. We would be easing our foot off the accelerator, not hitting the brakes.”

ADVANCING A MORE RESILIENT AND PROPORTIONAL BANKING REGULATORY FRAMEWORK IN CANADA

OSFI - Press Release (2021-03-24)

The Office of the Superintendent of Financial Institutions (OSFI) plays an essential role in building and preserving resiliency in Canada’s financial system. OSFI’s commitment to implementing the international Basel III Framework has strengthened Canadian banks and improved their ability to handle financial shocks, so they can continue to support economic growth while remaining competitive.

YELLEN NOW OPEN TO U.S. BANK DIVIDEND PAYOUTS, STOCK BUYBACKS

G&M - ANN SAPHIR AND DAVID LAWDER (2021-03-24)

U.S. Treasury Secretary Janet Yellen on Wednesday said U.S. banks look healthy enough to be allowed to pay dividends and repurchase stock, an updated view that reflects top economic officials’ growing confidence in the recovery from the coronavirus pandemic.

THOUSANDS OF CRA ACCOUNTS AFFECTED BY CERB-RELATED HACKING

G&M - Peter Brethour (2021-03-22)

Chris Chezepock thought he was making a simple call to unlock his online taxpayer account when he rang up the Canada Revenue Agency on Wednesday morning.

THE CASE AGAINST STIMULUS: WHY THE TYPICAL RESPONSE MAY BACKFIRE

G&M - Patrick Brethour (2021-03-19)

Consumers pare back spending as they either lose their jobs, or worry about the prospect of unemployment. That hurts sales at businesses, which then cut back on payroll, and those workers then reduce their spending. And for 80 years, the typical political response to myriad typical recessions has been to dump a lot of money into the economy to break that cycle of misery.

CANADA’S INFLATION RATE EDGES HIGHER, SETS STAGE FOR JUMP IN COMING MONTHS

G&M - Mark Rendell (2021-03-19)

Canada’s inflation rate edged up in February on rising gasoline prices, coming in below analysts’ estimates but setting the stage for a jump in consumer price index growth in the coming months.

CAPITAL CALLS: A TALE OF TWO CENTRAL BANKS

Reuters - Staff (2021-03-19)

Turkey is paying for past errors that cost it credibility and let inflation accelerate to nearly 16%, over three times its target. In the UK, prices have been rising too slowly rather than too fast. And even if they overshot for a bit, public and market expectations of inflation remain firmly anchored. The contrast explains why using monetary policy to support economic recovery is a luxury not available to all. (By Swaha Pattanaik)

CANADIAN’S SPYING TRIAL IN CHINA ENDS AFTER JUST TWO HOURS

Bloomberg - Bloomberg (2021-03-19)

The trial of a Canadian man detained in China since late 2018 on espionage charges has ended after about two hours, a lawyer said, one day after relatives pleaded for his release.

CHINA RAISES STAKES FOR U.S. WITH TRIALS IN HUAWEI FEUD

Bloomberg - Staff (2021-03-18)

Michael Spavor and Michael Kovrig will face their first court hearings Friday and Monday respectively, Canadian Foreign Minister Marc Garneau said in an emailed statement, adding that diplomats have requested to attend. “We believe these detentions are arbitrary, and remain deeply troubled by the lack of transparency surrounding these proceedings,” Garneau said.

POWELL FACES TOUGH CAMPAIGN TO CONVINCE TRADERS OF FED’S RESOLVE

Bloomberg - Emily Barrett (2021-03-18)

The central bank envisages keeping rates near zero to the end of 2023 despite a significantly brighter assessment of growth and higher inflation over the near term. After the release, traders trimmed some of the more-aggressive positioning they’ve been building for a “lift-off” by earlier in 2023.

CHINESE ECONOMY: BEIJING’S WAR ON THE CREDIT BOOM

FT - Tom Mitchell (2021-03-18)

Like many small businesses across China, Zheng Weijun’s freight company had struggled to obtain credit from the state-dominated banking system. But in 2018 the 12-lorry business discovered Fincera, a peer-to-peer platform in Hebei province that collected money from retail investors starved of returns and channelled it to borrowers, mainly small trucking and logistics companies.

CRA LOCKS OUT OVER 800,000 ONLINE ACCOUNTS — HERE'S WHAT TO KNOW

CBC - Ryan Patrick Jones (2021-03-17)

CRA's move comes in the middle of one of the most complicated tax seasons in recent memory, as millions of Canadians prepare to file taxes after receiving COVID-19 benefits.

BANK OF CANADA SEEN CUTTING BOND PURCHASES IN APRIL AS PEAK ISSUANCE PASSES

FP - Fergal Smith (2021-03-17)

A reduction of purchases by the BoC could be supportive of the Canadian dollar, which has been the best performing G10 currency this year, with a gain of about 2 per cent against the U.S. dollar. The central bank said this month that the currency has been relatively stable against the greenback.

FED THREADS A NEEDLE THAT’S ONLY GOING TO GET SMALLER

Bloomberg - Mohamed A. El-Erain (2021-03-17)

By raising its 2021 growth forecast to 6.5%, the Fed joined others in substantially improving its outlook for the U.S. economy. The forecast for the unemployment rate was reduced to 3.5%. Meanwhile, the Fed moved its favored measure of inflation — the PCE — up from 1.8% to 2.4%, for this year, with the core measures rising more moderately to 2.2%.

OSFI UNWINDS REGULATORY ADJUSTMENTS FOR BANKS SUBJECT TO MARKET RISK CAPITAL ADEQUACY RULES

OSFI - Press Release (2021-03-16)

These measures included a reduction in the Stressed Value at Risk (“SVaR”) multiplier, a component of the market risk capital requirements that ensures that a minimum amount of capital is held against stress periods. At the beginning of the pandemic, the volatility in capital markets increased such that the level of additional conservatism achieved through the SVaR multiplier was temporarily not needed and banks were permitted to reduce the level of the multipliers used.

CBA TAPS BIG DATA AND MACHINE LEARNING TO SUPPORT CUSTOMERS HIT BY NATURAL DISASTERS

Finextra - Finextra (2021-03-15)

The new technology platform uses custom-built algorithms to monitor, in real-time, a mix of data points from official emergency sources and weather alert systems to offer one-to-one, personalised support for customers impacted by natural disasters.

BOC INCREASES AVAILABILITY OF SECURITIES AS GROWING BOND OWNERSHIP AFFECTS KEY MARKETS

G&M - Mark Rendell (2021-03-15)

The Bank of Canada has expanded the size of its daily bond sale and repurchase program, making more securities available to dealers in an attempt to counteract the impact that its large ownership of Government of Canada bonds is having on short-term funding markets.

CANADA SHOULD PRIORITIZE FISCAL SUPPORT OVER DEBT MANAGEMENT AS ECONOMY RECOVERS, OECD SAYS

G&M - Matt Lundy (2021-03-12)

Policy makers in Canada need to keep supportive measures in place as the economy recovers from the COVID-19 pandemic before turning to debt management, the Organization for Economic Co-operation and Development said Thursday.

OSFI SEEKS TO FINALIZE BASEL III REFORMS

Investment Executive - James Langton (2021-03-12)

OSFI launched a consultation on measures to implement the remaining features of the latest edition of the global capital adequacy regime, known as Basel III — which includes capital, liquidity, leverage and disclosure requirements — that was developed in response to the global financial crisis.

BANK OF CANADA’S HEIGHTENED FOCUS ON LABOUR SLACK MAY COOL THE HEELS OF THE BOND MARKET

G&M - DAVID PARKINSON (2021-03-11)

The Bank of Canada has set a high bar for the eventual raising of interest rates. But that doesn’t mean the central bank is equally reluctant about scaling back its quantitative easing program, even if it’s not yet willing to say so out loud. They’re two separate and distinct questions.

BANK OF CANADA KEEPS ITS FOOT ON THE GAS, BUT HINTS AT CHANGES TO COME

FP - Kevin Carmichael (2021-03-11)

The Bank of Canada acknowledged it had underestimated the economy’s ability to power through the second wave of COVID-19 infections, scrapping its January prediction that gross domestic product (GDP) would contract in the first quarter of 2021.

INVESTORS BRACING FOR BANK OF CANADA TO TAPER: DECISION GUIDE

Bloomberg - Shelly Hagan (2021-03-10)

Economists unanimously predict policy makers led by Governor Tiff Macklem will leave their key interest rate unchanged at 0.25% at a 10 a.m. decision Wednesday in Ottawa. There’s speculation, however, they could signal plans to pare back the central bank’s asset purchases at the next meeting in April.

BANK OF CANADA WANTS A HOUSING BUBBLE, WHILE OTHER CENTRAL BANKS TRY TO POP THEM

Better Dwelling - Stephen Punwasi (2021-03-10)

Central banks are flooding economies with cheap credit, and trying to prevent bubbles. Well, some countries are trying to prevent bubbles. Canada has decided home price inflation is an uncontrollable consequence of the environment. In fact, the country’s central bank welcomed the rapid home price growth as “needed.”

BANK OF CANADA WILL HOLD CURRENT LEVEL OF POLICY RATE UNTIL INFLATION OBJECTIVE IS SUSTAINABLY ACHIEVED, CONTINUES QUANTITATIVE EASING

BOC - Press Release (2021-03-10)

The Bank of Canada today held its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank is maintaining its extraordinary forward guidance, reinforced and supplemented by its quantitative easing (QE) program, which continues at its current pace of at least $4 billion per week.

BOJ BOARD NOMINEE JUNKO NAKAGAWA IN HER OWN WORDS

Bloomberg - Yuko Takeo (2021-03-09)

Junko Nakagawa, a Nomura Holdings executive picked by Prime Minister Yoshihide Suga to join the Bank of Japan’s board, is seen as a policy moderate who’s likely to support the board’s current direction after her trailblazing rise in Japan’s male-dominated finance industry.

BANK OF CANADA INTEREST RATE ANNOUNCEMENT

BOC - BOC (2021-03-09)

On Wednesday, March 10, 2021, the Bank of Canada will announce its decision on the target for the overnight rate. A press release will provide a brief explanation of the decision.

AS ECONOMY HEATS UP, BANK OF CANADA WALKS A MESSAGING TIGHTROPE

G&M - Mark Rendell (2021-03-08)

The Bank of Canada will be walking a tightrope when communicating its rate decision this week, as rising bond yields and strong economic data have put its downbeat forecast at odds with brightening market expectations for a postpandemic recovery.

BOE GOVERNOR BAILEY SAYS RISKS TO U.K. ECONOMY REMAIN TILTED TO THE DOWNSIDE

Bloomberg - Lizzy Burden and Andrew Atkinson (2021-03-08)

Bank of England Governor Andrew Bailey said risks to the U.K. economy remain tilted to the downside, a remark that may rein in expectations that policy makers may soon shift toward containing inflation.

BRIGHTER FORECASTS BRING INFLATION, RATE HIKE WORRIES

Investment Executive - James Langton (2021-03-08)

“To us, it now appears likely that the U.S. output gap will be closed by the end of 2021 — an astonishing feat given just how ugly things were a year ago and highlighting once more how fundamentally different this latest recession has been from all those that have gone before it,” the report said.

MACHIN WAS PREPARING EXIT FROM CPPIB BEFORE UAE VACCINATION CONTROVERSY

G&M - ANDREW WILLIS AND TIM KILADZE (2021-03-05)

Mark Machin already had one foot out the door of Canada Pension Plan Investment Board when he was forced, under pressure, to resign as chief executive officer last week after receiving a COVID-19 vaccination in the United Arab Emirates.

BRITISH GOVERNMENT ANNOUNCES BIGGEST CORPORATE TAX HIKE IN DECADES IN BID TO HELP PANDEMIC-HIT ECONOMY

G&M - PAUL WALDIE (2021-03-04)

The British government has announced the country’s biggest corporate tax hike in almost 50 years in a bid to slowly fill the fiscal hole left by the pandemic.

ANT TUSSLES WITH BEIJING ON SHARING CUSTOMER DATA

Finextra - Finextra (2021-03-03)

The People's Bank of China wants access to Ant's consumer data to help state-owned banks assess credit worthiness.

CMHC TO GET NEW CEO AS EVAN SIDDALL STEPS DOWN NEXT MONTH

G&M - Rachelle Yungai (2021-03-03)

Evan Siddall, the outspoken housing agency chief who once told Canadians not to worship homeownership, is stepping down in April, ending his controversial and combative tenure.

BOC MUST CHANGE ITS TUNE AS ECONOMY OUTPERFORMS, REPORT SAYS

Better Dwelling - James Langton (2021-03-03)

Most sectors have almost reached pre-crisis levels, and the laggards that were hit hardest by the pandemic “are also the ones with potentially the most to gain should behaviour start to respond favourably to vaccinations over 2021 into 2022,” the report said.

EXTENDING WAGE, RENT SUBSIDIES TO JUNE 5 WILL COST $16-BILLION, CHRYSTIA FREELAND SAYS

G&M - Bill Curry (2021-03-03)

Federal subsidies for wages and rent will be extended at current levels until June 5, a move Finance Minister Chrystia Freeland said will cost about $16-billion.

CANADA GDP COLLAPSE REVEALS HOW TRUDEAU’S DEBT BINGE WENT AWRY

Bloomberg - Theophilos Argitis (2021-03-02)

Justin Trudeau was more committed to borrowing his way out of the Covid-19 crisis last year than almost any other leader in the developed world. That cushioned the blow of the pandemic, but raises some hard questions about what Canada got for all that spending.

SEC SUSPENDS TRADING IN MULTIPLE ISSUERS BASED ON SOCIAL MEDIA AND TRADING ACTIVITY

SEC - Press Release (2021-03-01)

Today's order states that trading is being suspended because of questions about recent increased activity and volatility in the trading of these issuers, as well as the influence of certain social media accounts on that trading activity. The order also states that none of the issuers has filed any information with the SEC or OTC Markets, where the companies' securities are quoted, for over a year. As a result, the SEC suspended trading in the securities of: Bebida Beverage Co. (BBDA); Blue Sphere Corporation (BLSP); Ehouse Global Inc. (EHOS); Eventure Interactive Inc. (EVTI); Eyes on the Go Inc. (AXCG); Green Energy Enterprises Inc. (GYOG); Helix Wind Corp. (HLXW); International Power Group Ltd. (IPWG); Marani Brands Inc. (MRIB); MediaTechnics Corp. (MEDT); Net Talk.com Inc. (NTLK); Patten Energy Solutions Group Inc. (PTTN); PTA Holdings Inc. (PTAH); Universal Apparel & Textile Company (DKGR); and Wisdom Homes of America Inc. (WOFA).

WHY IS MACKLEM INDIFFERENT TO STATSCAN’S INFLATION SHIFT?

G&M - DAVID PARKINSON (2021-02-25)

Statistics Canada took a pratfall this week on some key inflation calculations, and it couldn’t have come at a much more inopportune time. So why doesn’t Bank of Canada Governor Tiff Macklem – whose central responsibility is all about inflation – sound more bothered?

BOE GOVERNOR WARNS EU OVER DERIVATIVES CLEARING POWER GRAB

FT - Philip Stafford and Delphine Strauss in London and Sam Fleming (2021-02-25)

Its stance has increasingly drawn criticism from the UK’s central bank governor, who on Wednesday focused on the tussle over clearing houses, which sit between deals and prevent defaults from creating a chain reaction across markets.

BANK OF CANADA GOVERNOR INDICATES READINESS TO LET ECONOMY RUN HOT TO INCLUDE MORE PEOPLE IN RECOVERY

FP - Kevin Carmichael (2021-02-24)

Macklem, who took over as Bank of Canada governor in June, is making inequality the focus of policy, as Powell in the United States and Christine Lagarde at the European Central Bank have also done. On Feb. 23, Macklem made it clear that he intends to let the economy run hotter for longer than most mainstream economists would have thought safe only a few years ago, reinforcing both the likelihood that interest rates will remain extremely low for at least another couple of years and that more people will potentially get to participate in the recovery.

INFRASTRUCTURE BANK INVESTMENT STRATEGY

CIB-BIC - CIB-BIC (2021-02-24)

2021 statement of priorities and accountabilities.

FED’S JEROME POWELL SET TABLE FOR BIDEN ECONOMY, BUT WILL HE STAY FOR DESSERT?

G&M - Howard Schneider (2021-02-23)

Over the past year Federal Reserve Chair Jerome Powell has engineered the largest economic rescue in U.S. history, thrown a controversial lifeline to companies hard hit by the coronavirus pandemic and steered a sweeping labour-friendly revamp of monetary policy that any presidential administration would welcome.

BOE'S VLIEGHE DOUBTS HE WILL EVER SEE RATES BACK AT 5%

Reuters - David Milliken (2021-02-22)

Asked by students at Durham University when interest rates might return to the level of 4% to 5% common before the financial crisis, Vlieghe replied: “Maybe not in my lifetime.”

MARIO DRAGHI SWORN IN AS ITALY’S NEW PRIME MINISTER

FT - Miles Johnson (2021-02-22)

Draghi, one of Europe’s most highly regarded public officials, was unexpectedly called in by Mattarella earlier this month after the previous coalition collapsed in the middle of the latest pandemic wave.

STATSCAN REVISES CORE INFLATION UPWARD, BACKTRACKS ON NEW METHODS

G&M - Mark Rendell (2021-02-22)

The sudden revision surprised economists, causing some to question whether Statscan had an accurate picture of inflation. The change was made amid growing concern about higher-than-expected inflation, which is driving bond yields up and sending jitters through the market.

RESIDENTIAL MORTGAGE UNDERWRITING PRACTICES AND PROCEDURES GUIDELINE (B-20)

OSFI - OSFI (2021-02-18)

When Guideline B-20 revisions were introduced, lenders made changes that reduced the proportion of mortgages approved for the most highly indebted or over-leveraged borrowers (e.g. mortgage loans that exceed 450% of a borrower’s income.)

JAPAN AGREES $668 MILLION LOAN TO AFRICAN DEVELOPMENT BANK FUND

Reuters - Staff (2021-02-17)

The contribution from government development bank the Japan International Cooperation Agency will support efforts to improve African countries’ economic resilience at a time when many are struggling with the coronavirus pandemic, the AfDB said in a statement.

ROBINHOOD HEADS TO THE HILL: WHAT TO WATCH AT THE CONGRESSIONAL HEARING

FT - Philip Stafford (2021-02-17)

Hedge fund managers, professional investors and specialists in the more arcane corners of trade processing are clearing their diaries and checking popcorn supplies for a session that could determine how regulators deal with an explosion in trading by amateurs for years to come.

YELLEN NEEDS TO TELL ASIAN NATIONS TO STOP CURRENCY MANIPULATION

FT - David Waddill (2021-02-17)

In a time of global crisis, the persistent excess savings of the Asian nations need to be drawn down to help stimulate global growth — otherwise why were they accumulating these reserves other than for “beggar thy neighbour” purposes?

YELLEN SHIFT ON VAST TREASURY CASH PILE POSES PROBLEM FOR POWELL

Bloomberg - Rich Miller and Liz McCormick (2021-02-16)

Treasury Secretary Janet Yellen is giving Federal Reserve Chairman Jerome Powell a bit of a headache when it comes to managing the money markets.

US FINANCIAL SERVICES COMMITTEE NAMES WITNESSES FOR GAMESTOP HEARING

Securities Finance - Alex Pugh (2021-02-15)

Speakers include Robinhood CEO Vlad Tenev, hedge fund Citadel CEO Kenneth Griffin, Reddit CEO and co-founder Steve Huffman, Melvin Capital CEO Gabriel Plotkin, and day trader Keith Gill, who is credited with rallying the retail interest in GameStop through Reddit forum WallStreetBets.

CRYPTOCURRENCY BOOM IS 'SPECULATIVE MANIA,' BANK OF CANADA DEPUTY SAYS

FP - Shelly Hagan (2021-02-11)

A top Bank of Canada official called the recent spike in cryptocurrency prices “speculative mania,” and said such assets don’t have the qualities to become the money of the future.

BIDEN ADMINISTRATION WEIGHS FORGIVING STUDENT DEBT BY EXECUTIVE ACTION

WSJ - Josh Mitchell and Eliza Collins (2021-02-05)

The Biden administration is considering using executive action to forgive Americans’ federal student debt, the White House’s chief spokeswoman said Thursday, responding to pressure from Democratic lawmakers and progressive groups.

INFRASTRUCTURE BANK DIRECTED TO INVEST $1-BILLION IN INDIGENOUS PROJECTS

G&M - KRISTY KIRKUP AND BILL CURRY (2021-02-04)

The federal government has directed the Canada Infrastructure Bank to invest at least $1-billion in revenue-generating projects that benefit Indigenous peoples as part of a new statement of priorities for the Crown corporation.

BOC DEPUTY GOVERNOR LAWRENCE SCHEMBRI SEES LITTLE CHANGE TO INFLATION TARGETING FRAMEWORK

G&M - Mark Rendell (2021-02-04)

Bank of Canada deputy governor Lawrence Schembri is expecting little change to the central bank’s current inflation targeting regime, even as it examines alternative monetary policy targets, including a potential “dual mandate” that would put a more explicit focus on employment.

OTTAWA LAUNCHES NEW LOAN PROGRAM OF UP TO $1M FOR FIRMS WALLOPED BY COVID-19 SOCIAL SHARING

CBC - CBC (2021-02-04)

Businesses can qualify for between $25,000 and $1 million if they meet the eligibility requirements, the main one being that they must show their revenues have fallen by at least 50 per cent for at least three months out of the previous eight.

SIX BILLION DOLLARS AND COUNTING: MAJOR TAX BATTLE BETWEEN THE CRA AND CANADA'S BIG BANKS SHOWS NO SIGNS OF ABATING

FP - Geoff Zochodne (2021-02-02)

A major tax battle between the Canada Revenue Agency and the country’s six biggest banks has more than doubled in size over the past few years, with the lenders saying they are being reassessed for in excess of $6 billion due to a disagreement over dividends.

BITCOIN MAY 'BREAK DOWN ALTOGETHER' - BIS CHIEF

Finextra - Finextra (2021-01-29)

Bitcoin is "more of a speculative asset than money" that should perhaps "be seen more like a community of online gamers, who exchange real money for items that only exist in cyber space," says Carstens in a speech on digital currencies to the Hoover Institute.

CENTRAL BANKERS SHOW INTEREST IN DIGITAL CURRENCIES

G&M - Mark Rendell (2021-01-28)

Central bankers around the world are ramping up research into digital currencies, according to the Bank of International Settlements, even as cryptocurrencies such as bitcoin are likely to remain niche products with little use as payment methods.

HARD-HIT BUSINESSES GET DETAILS ON LIBERALS’ NEW LOAN FUND

Investment Executive - CP (2021-01-28)

The federally backed loan can be used for rent, utilities and help with payroll, among other costs, to keep operations running through public health restrictions, but can’t be used to pay or refinance existing loans.

UK GOVERNMENT PLANS POST-BREXIT REFORM OF INVESTMENT INDUSTRY

FT - Chris Flood and Emma Agyemang (2021-01-27)

The government has outlined far reaching proposals to strengthen the international competitiveness of the UK’s £9.9tn asset management industry with tax reforms and innovative fund structures, providing a road map for the sector’s future outside of the EU. 

AUSTRALIA'S SECURITIES REGULATOR SAYS SERVER HIT BY CYBER SECURITY BREACH

Reuters - Staff (2021-01-25)

Australia’s securities regulator said on Monday there was a cyber security breach at a server it used to transfer files including credit licence applications where some information may have been viewed.

TASK FORCE RECOMMENDS SWEEPING CHANGES TO OSC

Investment Executive - James Langton (2021-01-25)

Among other things, the task force called for a restructuring of the Ontario Securities Commission (OSC), including spinning out its adjudicative function, separating the chair and CEO roles, expanding its mandate to include promoting growth and even changing its name — to the Ontario Capital Markets Authority.

BIS INNOVATION HUB TARGETS CBDCS AND GREEN FINANCE IN 2021

Finextra - Finextra (2021-01-25)

Set up in 2019 the BIS Innovation Hub has centres in Switzerland, Hong Kong and Singapore, with locations in Toronto, London, Frankfurt and Paris, and Stockholm on the horizon.

EUROPEAN CENTRAL BANK SETS UP CLIMATE CHANGE CENTRE

Finextra - Finextra (2021-01-25)

The centre will shape and steer the ECB’s climate agenda internally and externally, building on the expertise of all teams already working on climate-related topics. Its activities will be organised in workstreams, ranging from monetary policy to prudential functions, and supported by staff that have data and climate change expertise.

PETER BETHLENFALVY, ONTARIO’S NEW FINANCE MINISTER, CAME INTO POLITICS TO SLASH DEFICITS. THEN, A PANDEMIC HAPPENED

G&M - James Bradshaw (2021-01-21)

For an avowed fiscal hawk like Peter Bethlenfalvy, it’s hard being thrust onto centre stage in the midst of a global pandemic.

CMHC SAYS W-SHAPED RECOVERY WOULD BE ‘VERY SEVERE’ WITHOUT GOVERNMENT ASSISTANCE

G&M - Tara Deschamps (2021-01-21)

A W-shaped recovery from the COVID-19 pandemic could trigger a nearly 50 per cent drop in housing prices and a peak unemployment rate of 25 per cent, if the government doesn’t offer relief, says the Canadian Mortgage and Housing Corporation.

WHY THE BANK OF CANADA COULD BE AMONG THE FIRST TO RAISE INTEREST RATES

FP - Kevin Carmichael (2021-01-20)

To be sure, these are future considerations. There won’t be any talk of higher interest rates when the Bank of Canada’s leaders conclude their latest round of policy deliberations on Jan. 20. The most pressing concerns for the central bank at this stage are whether a grim winter will cripple the recovery, and when to slow its multi-billion-dollar bond-purchase program, which could create asset-price bubbles if left in place too long.

BANK OF ENGLAND ADAPTS BANK STRESS TEST FOR PANDEMIC ERA

Reuters - Huw Jones (2021-01-20)

The Bank of England said on Wednesday the aim of its banking stress test this year is to check if banks can continue helping the economy during the pandemic and if a return to more normal levels of dividends is possible.

YELLEN MAKES CASE FOR SWEEPING STIMULUS PACKAGE IN FACE OF GOP SKEPTICISM

WSJ - Kate Davidson (2021-01-20)

Janet Yellen made the case for another sweeping economic aid package at her hearing to be the next U.S. Treasury secretary Tuesday, pushing back against Republican skepticism of the need for more deficit spending to bolster the recovery.

FOREIGN INVESTORS SNAP UP FEDERAL DEBT, BANK STOCKS

WSJ - James Langton (2021-01-19)

Foreign investors added $11.8 billion worth of Canadian securities during the month, “largely purchases of federal government debt,” the agency said Monday. Canadian investors acquired $7.6 billion of foreign securities, led by U.S. equities.

FINANCE MINISTER WARNED ABOUT INDEBTED CANADIANS' INCREASING VULNERABILITY TO HIGHER RATES BEFORE THE PANDEMIC

FP - Geoff Zochodne (2021-01-18)

The concerns were laid out in a memorandum addressed to then-finance minister Bill Morneau from his deputy in early 2020. The document, which was recently obtained by the Post via access-to-information request, explored the drivers of rising numbers of consumer insolvencies.

MARKET EYES BOC AHEAD OF POSSIBLE POLICY RATE MICROCUT

G&M - Mark Rendell (2021-01-18)

Few economists and market analysts expect the central bank to trim its overnight target rate on Wednesday. But they say the possibility can’t be ruled out as the bank tries to balance the near-term pain of lock-downs against better-than-expected vaccine news and robust fiscal stimulus.

POWELL SIGNALS FED WILL KEEP AIDING ECONOMY WITH BOND BUYING

Investment Executive - Christopher Rugaber (2021-01-15)

During an online discussion hosted by Princeton University, from which Powell earned his undergraduate degree, the Fed chair said the recovery of the economy from the pandemic recession “is far from our goals.” The Fed had said after its last policy meeting last month that it would continue to buy $120 billion in bonds each month until the economy made “substantial further progress” toward the Fed’s goals of maximum employment and stable 2% inflation.

BIDEN TO PUSH $1.9TN STIMULUS FOR PANDEMIC-BATTERED US ECONOMY

FT - James Politi (2021-01-15)

Joe Biden pleaded for Congress to “act now” on a new $1.9tn economic rescue plan, setting it up as his top legislative priority as he prepares to enter the White House next week.

FEDERAL DEBT IS MANAGEABLE WITH GDP GROWTH, POLOZ SAYS

G&M - Mark Rendell (2021-01-14)

Boosting Canada’s long-term economic growth by reducing interprovincial trade barriers and introducing programs such as universal daycare may be the best way to manage ballooning federal and provincial government debt, former Bank of Canada governor Stephen Poloz says.

U.S. DEFICIT IS 61% GREATER THAN SAME PERIOD A YEAR AGO

Investment Executive - Martin Crutsinger (2021-01-14)

The U.S. government’s deficit in the first three months of the budget year was a record-breaking $572.9 billion, 60.7% higher than the same period a year ago, as spending to deal with the Covid-19 pandemic pushed outlays up while revenue declined. (All figures are in U.S. dollars.)

CHINESE REGULATORS TO PUSH TECH GIANTS TO SHARE CONSUMER CREDIT DATA - SOURCES

Reuters - Julie Zhu (2021-01-11)

China plans to push tech giants including Ant Group, Tencent and JD.com to share consumer loan data to prevent excess borrowing and fraud, two people with knowledge of the matter said, in Beijing’s latest tightening of scrutiny.

TRUMP ORDERS BAN ON CHINESE APPS' TRANSACTIONS

Reuters - Reuters (2021-01-06)

U.S. President Donald Trump on Tuesday (January 5) signed an executive order banning transactions with eight Chinese software applications, including WeChat Pay and Alipay. Gloria Tso reports.

A $13 TRILLION CRISIS-ERA DEBT BILL COMES DUE FOR BIG ECONOMIES

Bloomberg - ANchalee Warrachate (2021-01-05)

The world’s biggest economies shouldering record debt burdens are about to confront an unwelcome legacy of the financial crisis: a $13 trillion debt bill.

CENTRAL BANKS’ DEBT MONSTERS WILL NEED TAMING

Reuters - Neil Unmack, Anna Szymanski (2021-01-04)

Central bankers will spend 2021 trying to tame the debt monsters they made in 2020. The pandemic-induced market meltdown forced Federal Reserve Chair Jay Powell to buy corporate debt for the first time, while European Central Bank President Christine Lagarde unveiled plans to spend an unprecedented 1.85 trillion euros propping up markets. Yet in helping resolve the crisis, rate-setters sowed the seeds of the next one.

ONTARIO FINANCE MINISTER RESIGNS OVER CARIBBEAN VACATION OUTRAGE

Bloomberg - Shelly Hagan (2021-01-04)

Ontario Finance Minister Rod Phillips stepped down from the position amid public outrage that he was vacationing in the Caribbean over the holidays, despite travel restrictions.

EUROPEAN SHARES MARK BEST CLOSE IN 10 MONTHS AFTER POST-BREXIT AGREEMENT

CBC - Reuters (2020-12-29)

Britain and the European Union signed a Brexit trade deal late on Thursday, preserving several trade provisions for both sides and limiting the scale of disruption resulting from the divorce.

BRITAIN, CANADA STRIKE SHORT-TERM DEAL TO AVOID POST-BREXIT TARIFFS

G&M - CP (2020-12-23)

“With this announcement, our government will ensure Canadian businesses that trade goods with the United Kingdom continue to have preferential access,” Freeland said in a statement.

VIRUS RELIEF PACKAGE OF CHEQUES, TAX BREAKS AND BUSINESS AID, THE SECOND BIGGEST RESCUE IN U.S. HISTORY, PASSES CONGRESS

FP - Erik Wasson, Laura Litvan and Billy House (2020-12-23)

The Senate followed the House late Monday in passing by overwhelming margins the US$2.3 trillion bill, just hours after lawmakers got their first look at the 5,593 pages of text. The White House has said President Donald Trump will sign it.

WHY BOC'S TIFF MACKLEM KEEPS A PICTURE OF G7 LEADERS AT THE HEIGHT OF THE 2008 CRISIS

FP - Kevin Carmichael (2020-12-21)

“I still have a picture, I’ll go get it afterwards,” said Macklem, who was the Finance Department’s top international official at the time. “I keep this picture of the beginning of the meeting. I’m in the picture and I look terrible. I was pretty stressed. I keep that in my office as a little reminder of that feeling in the pit of your stomach.”

CANADA WILL HURT ITSELF IF IT PULLS OUT OF ASIAN INFRASTRUCTURE BANK, PRESIDENT SAYS

G&M - Nathan Vanderklippe (2020-12-21)

The Asian Infrastructure Investment Bank plays a useful role in burnishing China’s image, its president acknowledges, even as he warns that Canada would hurt itself by leaving an international institution that critics have called a tool of Beijing.

BANK OF CANADA GOVERNOR WANTS TO AVOID HOUSING POLICY MISTAKES OF THE PAST

FP - Kevin Carmichael (2020-12-21)

“We do have very low interest rates, and we have given extraordinary forward guidance,” Tiff Macklem, the current Bank of Canada governor, said in an exclusive year-end interview on Dec. 16. “That’s partly how monetary policy works. It stimulates, lowers the cost of credit, so you’re probably going to see more spending on things that people use credit for. Housing would be high on that list.”

SOME PLAIN TALK ABOUT THE DOLLAR FROM BANK OF CANADA GOVERNOR TIFF MACKLEM

FP - Kevin Carmichael (2020-12-21)

In the end, the dollar played only a minor role in the Poloz story. He devoted a speech to the subject in 2014, but the currency rarely featured in interest-rate discussions. In his final interview as governor last May, Poloz said he thought that he had been unfairly tagged as being “soft on the dollar,” when all he was doing was trying to keep deflationary forces at bay.

YELLEN PRESSED TO BACK STRONG DOLLAR IN REVERSING TRUMP-ERA TONE

Bloomberg - Saleha Mohsin and Liz McCormick (2020-12-21)

The greenback’s tumble this year -- it’s heading for the second-biggest drop in the past decade and a half -- has already stoked foreign policy makers’ concerns, thanks to the competitive advantage it gives the U.S. Even a tacit endorsement of a weakening dollar could spur tensions with trading partners.

DON’T WORRY ABOUT CANADA BOND TAPER TANTRUM, CIBC SAYS

Bloomberg - Shelly Hagan (2020-12-18)

The Bank of Canada may be forced to wind down its bond purchases next year because its holdings are getting too large, but don’t expect the move to drive up domestic borrowing costs.

WHAT COULD FOLLOW END OF BOC’S STIMULUS MEASURES

Investment Executive - IE (2020-12-18)

A QE taper likely won’t lead to “severe” tightening of financial conditions, particularly if other larger central banks maintain their bond-purchasing volumes, the

CANADA’S HEAD BANKING REGULATOR TO STEP DOWN IN JUNE

G&M - James Bradshaw (2020-12-18)

The head of Canada’s banking regulator, Jeremy Rudin, will not seek a second term and will step down from his post next June.

BREXIT TRADE TALKS ‘IN A SERIOUS SITUATION’ AND NO DEAL VERY LIKELY, UK SAYS

G&M - GUY FAULCONBRIDGE AND KATE HOLTON (2020-12-18)

British Prime Minister Boris Johnson’s office said on Thursday that trade talks with the European Union were in a “serious situation” and that no agreement would be reached unless the bloc changed its position substantially.

2020 RISK MANAGEMENT WEBCAST FOR DEPOSIT-TAKING INSTITUTION

Youtube - Jeremy Rudin (2020-12-18)

OSFI hosted the 2020 Risk Management Webcast for Deposit-Taking Institution on November 23, 2020. Please click the timestamps below to jump to specific topics in the video:

FEDERAL RESERVE VOWS TO CONTINUE BOND PURCHASES UNTIL RECOVERY SEES ‘SUBSTANTIAL PROGRESS’

G&M - HOWARD SCHNEIDER, ANN SAPHIR AND JONNELLE MARTE (2020-12-17)

“The parts of the economy that are weak are the service-sector businesses that involve close contact,” such as restaurants and the travel industry, Powell said in a news conference following the two-day policy meeting.

SECOND WAVE COULD SEND ECONOMIC GROWTH INTO NEGATIVE TERRITORY IN FIRST QUARTER, BANK OF CANADA’S MACKLEM WARNS

G&M - DAVID PARKINSON (2020-12-16)

“Near term, rising COVID-19 infections will dampen growth and could even deepen our economic hole,” Mr. Macklem said in a speech via video-conference Tuesday to the Greater Vancouver Board of Trade.

THE BANK OF CANADA INSISTS IT IS NOT FUNDING THE GOVERNMENT. REALLY?

G&M - KONRAD YAKABUSKI (2020-12-16)

Some experts believe the Bank of Canada and its counterparts in the United States and Europe have embarked on a course of debt monetization as their economies lurch from crisis to crisis. And they worry that domestic politics will make it very hard to reverse course.

WALL OF MONEY HEADED FOR INFRASTRUCTURE PROJECTS

FP - Barbara Shecter (2020-12-16)

“I really encourage governments around the world that have got massive deficits to really consider at this point privatizing, you know, selling operating brownfield infrastructure assets, if they can, because they’re going to get extraordinary prices for it, given the wall of money that’s interested in it, and it will help (bring down) deficits.”

FEDERAL RESERVE 'BONEHEADS' EMERGE FROM TRUMP ERA UNSCATHED

Reuters - Howard Schneider (2020-12-16)

In the end, the guard-rails mostly held. The Fed on Wednesday concludes the last Federal Open Market Committee meeting with Trump in the White House. The bank has avoided the sort of reputational damage suffered by many federal agencies, like the Centers for Disease Control or the Environmental Protection Agency, where politics seemed to gain a foothold over technical expertise and original mission.

FED MULLS SHIFT IN BOND BUYING PROGRAM: FOMC DECISION-DAY GUIDE

Bloomberg - Steve Matthews (2020-12-16)

Economists say the Fed may deliver fresh guidance on its asset purchases, now $120 billion a month, tying how long the buying will continue to substantial progress in meeting its goals of full employment and 2% inflation. That would be a stronger commitment than the existing pledge to maintain purchases “over coming months.”

WILL THE FED ADJUST ITS ASSET PURCHASE PROGRAMME?

FT - FT (2020-12-14)

When members of the Federal Open Market Committee convene for their final meeting of the year on Tuesday and Wednesday, the fate of the US central bank’s asset purchase programme will be in focus. 

EU REACHES COMPROMISE WITH HUNGARY AND POLAND, UNBLOCKING €1.8-TRILLION PANDEMIC RECOVERY FUND

G&M - JAN STRUPCZEWSKI AND KATE ABNETT (2020-12-11)

European Union leaders unblocked on Thursday a 1.8 trillion euro financial package to help the economy recover from the pandemic-induced recession after reaching a compromise with Poland and Hungary, the chairman of EU leaders Charles Michel said.

BANK OF ENGLAND READIES ARMOURY TO DEAL WITH ANY BREXIT DISRUPTION

Reuters - David Milliken, Huw Jones (2020-12-11)

The Bank of England took steps on Friday to keep banks lending through 2021 as Britain grapples with the COVID-19 pandemic and braces for any market disruption from a big change in the UK’s trading relationship with the European Union.

BOND-BUYING PROGRAM FACES MISCONCEPTIONS, BOC SAYS

Investment Executive - ANITA BALAKRISHNAN (2020-12-11)

The central bank has purchased a little more than $180 billion in Government of Canada bonds since March as part of its quantitative easing, or QE, program. Over the same period, the federal government has rolled out a slew of spending programs to support businesses and consumers amid job losses tied to the Covid-19 pandemic.

THE DOLLAR HAS HAD A 100-YEAR RUN AS THE WORLD'S RESERVE CURRENCY. BUT A NEW CLASS OF CONTENDERS IS EMERGING

FP - Ruchir Sharma (2020-12-10)

Before the U.S., only five powers had enjoyed the coveted “reserve currency” status, going back to the mid-1400s: Portugal, then Spain, the Netherlands, France and Britain. Those reigns lasted 94 years on average. At the start of 2020, the dollar’s run had endured 100 years. That would have been reason to question how much longer it could continue, but for one caveat: the lack of a successor.

HIGH LOONIE ON THE RADAR AS BANK OF CANADA SEES 'CHOPPY' RECOVERY FROM PANDEMIC

FP - Kevin Carmichael (2020-12-10)

Governor Tiff Macklem and his deputies on the Governing Council made explicit mention of the exchange rate for the second consecutive time while updating their interest-rate stance, a signal that the dollar’s recent strength could reduce what Canada might otherwise expect to earn from exports.

BANK OF CANADA WILL MAINTAIN CURRENT LEVEL OF POLICY RATE UNTIL INFLATION OBJECTIVE IS ACHIEVED, CONTINUES ITS QUANTITATIVE EASING PROGRAM

BOC - Media Relations (2020-12-10)

The Bank of Canada today maintained its target for the overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent. The Bank is maintaining its extraordinary forward guidance, reinforced and supplemented by its quantitative easing (QE) program, which continues at its current pace of at least $4 billion per week.

BANK OF CANADA OPENS DOOR TO ANOTHER RATE CUT — BUT NOT ONE BELOW ZERO

FP - Kevin Carmichael (2020-12-10)

The Bank of Canada has now officially said it could potentially drop the benchmark interest rate below its current setting of 0.25 per cent, while emphasizing that it remains deeply skeptical of negative interest rates.

THE U.S. IS FINALLY DOING SOMETHING ABOUT THE GLOBAL MONEY LAUNDERING SCOURGE. WILL WE?

FP - Diane Francis (2020-12-10)

The bill is part of the National Defense Authorization Act, the annual omnibus defence bill that passed in the House of Representatives by a veto-proof margin, which means that neither the sitting nor future president can overrule it. The Senate is expected to follow.

‘QE DOES NOT RELEASE THE GOVERNMENT FROM ITS LIABILITIES’: BOC DEPUTY GOVERNOR

G&M - DAVID PARKINSON (2020-12-10)

Bank of Canada deputy governor Paul Beaudry used a key speech Thursday to defend the central bank’s quantitative easing program, seeking to dispel the notion that it is printing money to finance the federal government’s huge deficit.

CANADA’S CREDIT RATING COULD TAKE ANOTHER HIT IF OTTAWA STICKS TO SPENDING PLANS, FITCH WARNS

FP - Reuters (2020-12-09)

“Canada’s recently released medium-term financial roadmap reinforces the likelihood of a rising public debt burden and expansionary fiscal policy without precise details of a return to a fiscal anchor and consolidation,” Fitch Ratings said in an article posted on its website on Monday.

BANK OF CANADA TO RESTATE LOW-RATE GUIDANCE: DECISION-DAY GUIDE

Bloomberg - Shelly Hagan (2020-12-09)

Economists predict the central bank will restate a pledge to hold its overnight interest rate at 0.25% until at least 2023, while continuing bond purchases at the current pace of C$4 billion ($3.1 billion) per week. The bank releases its December policy decision at 10 a.m. in Ottawa.

CHINA’S YUAN RAPIDLY FALLS AT CLOSE AFTER HITTING STRONGEST LEVEL IN 2 YEARS

Bloomberg - Bloomberg (2020-12-09)

China’s yuan weakened minutes before Wednesday’s official close, reversing an earlier gain that had pushed the currency to its strongest level in more than two years.

TRUDEAU’S FINANCE SHAKE-UP SIGNALS FULL STEAM AHEAD ON SPENDING

Bloomberg - Theophilos Argitis and Kait Bolongaro (2020-12-08)

Michael Sabia, a big-name corporate leader who has run the nation’s largest phone company and second-largest pension fund, was appointed deputy minister of finance Monday. The move formalizes the role he’s played since the early days of the pandemic as a top adviser to both Trudeau and his finance minister, Chrystia Freeland.

EUROZONE CHIEF SEIZES ON VIRUS AND BREXIT TO REVIVE BANKING UNION

FT - Sam Fleming and Mehreen Khan (2020-12-08)

Brexit and the coronavirus pandemic have reinforced the need to solidify the single currency’s foundations, said the president of the Eurogroup of finance ministers, who will seek to revive the bloc’s long-stalled banking union project this week.

OSFI KEEPS BIG BANKS’ CAPITAL BUFFER STEADY, SAYS FINANCIAL SYSTEM STILL FACES UNCERTAINTY FROM PANDEMIC

G&M - James Bradshaw (2020-12-08)

Canada’s banking regulator has chosen to leave a key threshold for large banks’ capital reserves unchanged, even as it warned that the country’s financial system still has vulnerabilities and faces uncertainty amid the coronavirus pandemic.

OSFI RELEASES NEW (AND SOFTER) PROPOSED RULE ON HIGH-LIMIT POLICIES

Canadian Underwriter - David Gambrill (2020-12-07)

Canada’s solvency regulator has come out with a softer version of its proposed rule regarding the property and casualty insurance industry’s issuance of high-limit policies.

DOMESTIC STABILITY BUFFER

OSFI - OSFI (2020-12-07)

Decisions on the calibration of the buffer are based on OSFI supervisory judgement, informed by its monitoring and analytical work on a range of vulnerabilities, and are made in consultation with OSFI's federal financial regulatory partners.

WE’LL PAY FOR ALL THESE DOWN PAYMENTS

FP - Jack M. Mintz (2020-12-04)

The fiscal update does not say by how much each dollar of government spending increases GDP but during the pandemic it must be low. Household incomes rose by 13 per cent during the downturn, more than in any other OECD country (even the U.S. during its election year). But despite all this new money, households did not spend more. Instead, our household saving rate jumped by 23 per cent of personal disposable income, more than in any other country. The update spins this embarrassing fact by saying Canadians were getting a “down payment” now to spend later.

U.S. BANK LOBBY SPENDS $1 MILLION ON AD BLITZ FOR REPUBLICAN PERDUE IN GEORGIA U.S. SENATE RUNOFF

Reuters - Pete Schroeder (2020-12-04)

The largest U.S. bank lobby group is spending $1 million on television ads to boost Republican Senator David Perdue, in a bid to ensure the Senate remains in Republican hands after Georgia runoffs in January, according to federal filings.

MORE THAN 400 LAWMAKERS FROM 34 COUNTRIES BACK 'MAKE AMAZON PAY' CAMPAIGN

Reuters - Paul Sandle (2020-12-04)

More than 400 lawmakers from 34 countries have signed a letter to Amazon.com Inc boss Jeff Bezos backing a campaign that claims the tech giant has “dodged and dismissed … debts to workers, societies, and the planet,” organisers said.

CHRYSTIA FREELAND VETTING AT LEAST FIVE CANDIDATES FOR NEW FINANCE CANADA DEPUTY

G&M - Andrew Willis (2020-12-03)

Finance Minister Chrystia Freeland is looking outside her own department for the new second-in-command who will help steer Canada’s economy through the pandemic and the $100-billion stimulus spending campaign that will follow.

BOJ'S SUZUKI SAYS CENTRAL BANK SHOULD ALLOW YIELD CURVE TO STEEPEN MORE

Reuters - Leika Kihara (2020-12-03)

Under its yield curve control policy, the BOJ seeks to keep short-term interest rates at around -0.1% and 10-year bond yields around zero as part of efforts to revive the economy with low borrowing costs.

OTTAWA GIVES HOUSEHOLDS $7 FOR EVERY DOLLAR OF INCOME LOST IN PRIVATE SECTOR

G&M - Patrick Brethour (2020-12-02)

Statistics Canada data show that primary household income, or private-sector earnings, barely dropped between the first quarter of 2020 and third quarter, falling by just 1 per cent, or $15.2-billion to $1.52-trillion. But transfers from government, which include existing programs such as employment insurance plus new coronavirus-era programs, made up for that drop many times over. Those transfers rose by $103.8-billion from the first quarter to the third quarter, meaning that the government effectively gave households nearly $7 for each dollar of lost private-sector income. Those figures are seasonally adjusted and stated on an annualized basis.

THE CPP PREMIUM HIKE FOR 2021 LOOKS BAD, BUT IT WILL DO A LOT OF GOOD

G&M - Rob Carrick (2020-12-02)

In a year of plenty, we’d shrug off the coming increase in the amount of our paycheques that goes toward Canada Pension Plan premiums.

MERCHANTS CALL FOR LEVEL PLAYING FIELD AS LOCKDOWN RULES PICK WINNERS AND LOSERS IN RETAIL

FP - Barbara Shecter (2020-11-30)

In Manitoba, for example, businesses are permitted to sell only essential items such as food and pharmaceuticals regardless of the full inventory they carry, she said. Meanwhile, Ontario’s restrictions for the hot zones Toronto and nearby Peel permit big-box businesses to be fully open as long as they also sell some items deemed essential.

BANK OF CANADA CHIEF DEFENDS BOND PURCHASES FROM POLITICAL ATTACKS

Bloomberg - Shelly Hagan (2020-11-30)

Governor Tiff Macklem brushed off accusations the Bank of Canada is financing Justin Trudeau’s deficits and fueling inflation risks, even as he acknowledged there are limits to how much government debt it can buy.

CRA ASSESSES NEARLY $60 MILLION UNDER OFFSHORE TAX INFORMANT PROGRAM

Investment Executive - Rudy Mezzetta (2020-11-30)

Under OTIP, a whistleblower program launched in 2014, the CRA provides financial rewards to individuals who come forward with information related to major international tax evasion and aggressive tax avoidance that lead to the collection of taxes owing.

FEDS MAY BOLSTER SUPPORTS TO BUSINESS, HOUSEHOLDS: RBC

Investment Executive - James Langton (2020-11-30)

“We already see some stimulus bleeding into next year, with current announcements bringing the deficit to at least $90 billion in 2021-2022,” it said, noting that extensions of existing government supports could add $40 billion to deficits through the end of 2021 “even before new spending announcements.”

LIBERALS TO SPEND $100B TO JOLT POST-PANDEMIC ECONOMY AFTER POSTING RECORD $381B DEFICIT

G&M - Kathleen Harris (2020-11-30)

The short-term stimulus package is valued at $70 billion to $100 billion over roughly three years. The government says the stimulus spending — intended to build a greener, more inclusive, more innovative and competitive economy — will launch after a vaccine is distributed and life begins to return to normal.

PROVINCES PUSH FREELAND TO DELAY PLANNED BUMP IN CPP PREMIUMS IN ECONOMIC UPDATE

FP - CP (2020-11-27)

Provincial finance ministers have quietly prodded Finance Minister Chrystia Freeland to pause planned increases in premiums workers and businesses pay into the Canada Pension Plan.

THE TOP CONTENDERS TO RUN BIDEN'S FINANCIAL AGENCIES

Reuters - Pete Schroeder, Michelle Price, Katanga Johnson (2020-11-27)

The CFPB director is a critical role for progressives such as Senator Elizabeth Warren who believe the agency can help tackle wealth inequality and racial injustice. A U.S. Supreme Court ruling in June handed Biden the power to fire Republican President Donald Trump’s CFPB director, Kathy Kraninger, and many policy experts expect the former vice president to quickly remove her after he takes office on Jan. 20.

BANK OF CANADA CHIEF DEFENDS BOND PURCHASES FROM POLITICAL ATTACKS

Bloomberg - Shelly Hagan (2020-11-27)

In parliamentary testimony on Thursday, Macklem faced questions from opposition Conservative Party lawmakers over the central bank’s quantitative easing program, which has been used to buy nearly C$200 billion ($154 billion) in federal government bonds since April.

TOUGHER CAPITAL RULES FOR BATCHES OF BAD LOANS

Investment Executive - James Langton (2020-11-27)

The Basel Committee noted that it began working on the capital rules for non-performing loan securitizations before the onset of Covid-19.

CANADA’S BANKING REGULATOR CAUTIONS AGAINST LIFTING BAN ON BANKS RAISING DIVIDENDS TOO SOON

G&M - Staff (2020-11-25)

Canada’s banking regulator is cautioning against lifting restrictions on banks’ dividend payments and share buybacks too soon as cases of the novel coronavirus spike again.

WITH JANET YELLEN AT TREASURY, JOE BIDEN SIGNALS FURTHER BLURRING OF FISCAL, MONETARY POLICIES

G&M - KONRAD YAKABUSKI (2020-11-25)

In nominating Janet Yellen to become his Treasury secretary, president-elect Joe Biden has opted for a steady hand and consensus-builder to steer U.S. fiscal policy just as economists increasingly warn the country is poised to slip back into recession.

BANK OF CANADA DEPUTY DOWNPLAYS RISKS OF CONSUMER DEFAULT WAVE

FP - Shelly Hagan (2020-11-25)

Signs of overwhelming financial strain are few, and the risk of a wave of consumer defaults seems low, Deputy Governor Toni Gravelle said in remarks via video conference to the Autorite des marches financiers. Almost all of the households with expired debt deferrals have resumed repayments, and government measures are helping businesses in many sectors manage cash flows, he said.

FRANCE DEMANDS DIGITAL TAX PAYMENTS FROM US TECH GROUPS

Irish Times - Aime Williams, Hannah Murphy, Victor Mallet (2020-11-25)

BRUSSELS CRITICISED FOR GIVING BLACKROCK SUSTAINABLE FINANCE CONTRACT

FT - Mehreen Khan, Siobhan Riding (2020-11-25)

Emily O’Reilly, the EU’s independent ombudsman, on Wednesday said the European Commission’s decision to give the world’s largest fund manager a contract worth €280,000 had exposed the weakness of Brussels procedures on conflicts of interest when hiring from the private sector to advise on major policy areas. 

THE CANADIAN BANKING SYSTEM THROUGH THE PANDEMIC: WHERE WE ARE AND WHERE WE ARE GOING

OSFI - OSFI (2020-11-25)

In the first quarter that was reported after the onset of the pandemic, we hit what I like to call the “downturn trifecta”: [1] Loan growth rose (supporting the economy). [2] Loan loss provisions went up (because of the downturn). And [3] market participants were unconcerned by the decline in bank capital levels. This was a textbook example of how the capital regime should work during a downturn, one where the banking system is able to absorb shocks rather than forced to amplify them.

FEDERAL GOVERNMENT SPENDS $5-MILLION ON OUTSIDE CONSULTANTS FOR LEEFF EMERGENCY LOAN PROGRAM

G&M - Bill Curry (2020-11-24)

The federal government has spent nearly $5-million on outside consultants to set up a COVID-19 emergency support program for large companies that has delivered just two loans since launching six months ago.

CHRYSTIA FREELAND TO PROVIDE BUDGET UPDATE ON NOV. 30

FP - Kate Bolongaro (2020-11-24)

Finance Minister Chrystia Freeland told lawmakers Monday that her department will release new deficit projections on Nov. 30. The economic statement could also include details of new permanent spending on long-term priorities including childcare.

TRUMP ADMINISTRATION GIVES GREEN LIGHT TO PROCEED WITH BIDEN TRANSITION

Reuters - Jeff Mason, Trevor Hunnicutt (2020-11-24)

After weeks of waiting, President Donald Trump’s administration on Monday cleared the way for President-elect Joe Biden to transition to the White House, giving him access to briefings and funding even as Trump vowed to continue fighting the election results.

BIDEN TO NAME YELLEN TO TREASURY TO LEAD U.S. FROM SHARP ECONOMIC DOWNTURN

Reuters - Trevor Hunnicutt, David Lawder (2020-11-24)

President-elect Joe Biden is expected to nominate former Federal Reserve Chair Janet Yellen as U.S. Treasury secretary, breaking a 231-year gender barrier and putting a seasoned economist and labor market expert in charge of leading the country out of the steepest downturn since the Great Depression.

U.K., CANADA ON BRINK OF TRADE AGREEMENT, REPLACING EU DEAL

Bloomberg - Joe Mayes, Kait Bolongaro, Tim Ross, and Shelly Hagan (2020-11-19)

The agreement would be a major boost to U.K. Prime Minister Boris Johnson in his efforts to plot a new course for Britain as a global trading nation outside the EU. An announcement is expected within days, according to people familiar with the matter who spoke on condition they not be identified.

CANADA NEEDS TO PICK UP PACE ON TACKLING CLIMATE CHANGE, TIFF MACKLEM SAYS

CBC - Jordan Press (2020-11-18)

Canada's top central banker is making a plea for the country to more quickly address the impacts of climate change to avoid any economic ripple effects on households and businesses.

ITALY TO SCRAP BAD LOAN LAW THAT COULD HAVE SAVED BANKS BILLIONS

Bloomberg - Chiara Albanese and Sonia Sirletti (2020-11-18)

The government decided not to extend into 2021 a tax benefit introduced earlier this year to facilitate the disposal of non-performing loans held on the balance sheets of Italian banks. Lenders and customers have been severely hit by the pandemic crisis.

FOREIGN MINISTER FRANçOIS-PHILIPPE CHAMPAGNE SAYS OTTAWA POISED TO ACT AGAINST CHINA’S INTERFERENCE IN CANADA

G&M - Robert Fife (2020-11-18)

Facing parliamentary pressure to stand up to Beijing’s use of covert agents to target Canadians, Foreign Affairs Minister François-Philippe Champagne says Ottawa is planning new measures to crack down on these kinds of intimidation tactics.

MOVING ON: BANK OF CANADA’S WILKINS READY TO ‘EXPLORE THE NEXT CHAPTER’

G&M - DAVID PARKINSON (2020-11-16)

Ms. Wilkins sat down for an interview via video conference just days after she had informed the bank’s board that she would step down Dec. 9, five months before the end of her seven-year term – ending a nearly 20-year career at the central bank.

CURRENCY WARS HAVE BEEN MISSING DURING THIS CRISIS, BUT IT ONLY TAKES A SPARK

FP - Kevin Carmichael (2020-11-16)

The most skittish currency traders will have taken note. The Bank of Canada has only mentioned the dollar in nine of its 23 policy statements since the start of 2018, so policy-makers might have been sending a signal that they thought the dollar was getting too strong: a form of stimulus known as “jawboning” or “jaw-jaw” that has been known to to move markets in favourable directions.

BANK OF CANADA AND OSFI LAUNCH PILOT PROJECT ON CLIMATE RISK SCENARIOS

OSFI - OSFI (2020-11-16)

The Bank of Canada and the Office of the Superintendent of Financial Institutions (OSFI) today announced plans for a pilot project to use climate-change scenarios to better understand the risks to the financial system related to a transition to a low-carbon economy. A small group of institutions from the banking and insurance sectors will participate voluntarily in the project.

CHRISTINE LAGARDE SAYS HER 'HUNCH' IS THAT ECB WILL ADOPT DIGITAL CURRENCY

FP - Alexander Weber (2020-11-13)

The ECB took a major step last month by launching a public consultation that runs until the middle of January. Policy makers intend to decide around mid-2021 whether to initiate a full-fledged project and prepare for a possible launch.

WILKINS SAYS CANADA WILL EXIT PANDEMIC WITH REDUCED POTENTIAL

Bloomberg - Shelly Hagan (2020-11-13)

The Bank of Canada’s top deputy said the country is likely to come out of the pandemic with a lower outlook for potential growth and permanent labor force scarring, and that conventional wisdom must be challenged to find solutions.

TOP CENTRAL BANKERS: ECONOMY NEEDS HELP DESPITE VACCINE NEWS

Investment Executive - David McHugh (2020-11-13)

Speaking at an online conference held by the European Central Bank, Powell, Bank of England governor Andrew Bailey and European Central Bank head Christine Lagarde emphasized the longer-term threat to the economy from the pandemic while welcoming the preliminary results showing a vaccine by BioNTech and Pfizer was highly effective.

OSC TO LEAVE FEES ALONE FOR NOW

Investment Executive - James Langton (2020-11-13)

“Our analysis indicates that maintaining current fee levels and leveraging our cash position will ensure that we can continue to deliver on our priorities,” the OSC said.

CHINA DEALS 'SEVERE BLOW' TO HONG KONG FREEDOMS, EU SAYS

Reuters - Staff (2020-11-12)

The European Union called on Beijing on Thursday to immediately reverse new rules to disqualify elected legislators, saying the decision was a “severe blow” to the former British colony’s autonomy.

WAS THE BANK OF AMSTERDAM THE WORLD’S FIRST CENTRAL BANK?

FT - Claire Jones (2020-11-12)

The Bank of Amsterdam is to central banking history what Little Richard is to rock ‘n’ roll. While the public might like to think it was Elvis or the Fab Four that invented it, the purists know they merely popularised it.

STEPHEN POLOZ ON INTEREST RATES, OUR OIL INDUSTRY AND THE K-SHAPED RECOVERY — PODCAST

FP - Gabriel Friedman (2020-11-11)

In terms of Canada’s economic recovery, Poloz said that the government’s income support programs have been critical because it’s people on the lower end of the income scale who have been hurt the worst in this crisis. He sees a K-shaped economic recovery — in which some parts of the economy bounced back, but other parts may be in serious trouble.

JAPANIFICATION STALKS NEW ZEALAND DEBT THAT’S 37% OWNED BY RBNZ

Bloomberg - Masaki Kondo (2020-11-10)

The Reserve Bank of New Zealand’s growing dominance of its bond market is sparking unfavorable comparisons with Japan.

BANK OF CANADA FURTHER CURTAILING EMERGENCY MEASURES

Investment Executive - James Langton (2020-11-10)

Citing further improvement in financial market conditions, the Bank of Canada is continuing to pull back liquidity support programs that were adopted in response to the disruptions caused by Covid-19.

B.C.’S ANTI-MONEY LAUNDERING EFFORT FLAWED: C.D. HOWE

Investment Executive - James Langton (2020-11-10)

Among other things, the report warned that the registry’s identification information isn’t actively verified, that the searchability and discoverability of information is “unreasonably restricted,” and that the penalties for filing false information are unlikely to serve as a meaningful deterrent.

FEDS HAVE WIGGLE ROOM TO SPEND MORE, PBO SAYS

Investment Executive - CP (2020-11-09)

Based on the budget officer’s calculations, the government could increase spending, reduce taxes, or a combination of the two to the tune of $19 billion and still reduce the debt-to-GDP ratio over time to pre-pandemic levels.

LOCKDOWN BRITAIN: THE CURE IS WORSE THAN THE DISEASE.

Youtube - Nigel Farage video (2020-11-09)

I am back in the UK giving my latest update on lockdown Britain and the US election.

AIRLINES WIN CHANGE OF HEART IN OTTAWA AS GOVERNMENT CONSIDERS BAILOUT LOANS

G&M - Andrew Willis (2020-11-09)

The federal Liberals are embracing support for Canada’s airlines after being told domestic carriers are losing their most lucrative line of business – international flights – to government-backed rivals.

CANADIAN BUSINESSES SEE BENEFITS IN DIVIDED U.S. GOVERNMENT AS THEY PREPARE TO NAVIGATE POLITICAL GRIDLOCK

G&M - Mark Rendell, James Bradshaw (2020-11-05)

Canadian business leaders are preparing to navigate political gridlock south of the border, with the U.S. Congress appearing to split between the Democrats and Republicans, reducing the likelihood of a strong policy shift to the left.

BIDEN EDGES CLOSER TO WHITE HOUSE WIN AS TRUMP MOUNTS LEGAL CHALLENGE

G&M - AP (2020-11-05)

Democrat Joe Biden moved closer to victory in the U.S. presidential race on Thursday as election officials tallied votes in the handful of states that will determine the outcome and protesters took to the streets.

BANK OF CANADA BEGINS SEARCH FOR NEW TOP DEPUTY AFTER WILKINS

Bloomberg - Shelly Hagan (2020-11-05)

With Carolyn Wilkins moving on when her term ends May 1, the Ottawa-based central bank published the job posting Wednesday. The search for her replacement will be undertaken by recruiting firm Boyden.

WHY CENTRAL BANKERS GOT SERIOUS ABOUT DIGITAL CASH

Bloomberg - Why Central Bankers Got Serious About Digital Cash (2020-11-05)

What central banks once sneered at, they’re now scrambling to master. Back when Bitcoin, the world’s first cryptocurrency, was seen as the province of anarchists and drug dealers, it was easy for the world’s central bankers to keep their distance. That changed in a hurry after Facebook Inc. proposed creating its own digital currency, Libra. Suddenly, the concept was seen as both practical and as a potential threat to existing monetary regimes. The central banks of China, the euro area, the Bahamas and others have been experimenting in the field, while others, including the U.S. Federal Reserve and Bank of England, are conducting research but not plunging in, at least for now.

1. What was so alarming about Libra?

BANK OF CANADA’S CAROLYN WILKINS MOVES HER DEPARTURE DATE TO DECEMBER

G&M - DAVID PARKINSON (2020-11-05)

Carolyn Wilkins, the Bank of Canada’s second-in-command, has decided to leave the bank in early December, five months before the end of her term.

FEDERAL RESERVE HOLDS POLICY STEADY AND SIGNALS READINESS TO DO MORE TO SUPPORT ECONOMIC RECOVERY

G&M - HOWARD SCHNEIDER AND ANN SAPHIR (2020-11-05)

The Federal Reserve kept its loose monetary policy intact on Thursday and pledged again to do whatever it can in coming months to sustain a U.S. economic recovery threatened by a spreading coronavirus pandemic and facing uncertainty over a still undecided presidential election.

FED SIGNALS READINESS TO DO MORE FOR ECONOMY AS VIRUS RAGES

Investment Executive - Martin Crutsinger (2020-11-05)

The Fed announced no new actions after its latest policy meeting but left the door open to provide further assistance in the coming months. The central bank again pledged to use its “full range of tools to support the U.S. economy in this challenging time.” The economy in recent weeks has weakened after mounting a tentative recovery from the deep pandemic recession in early spring.

EXTENSION OF EXCLUSIONS FROM THE LEVERAGE RATIO EXPOSURE MEASURE

OSFI - OSFI (2020-11-05)

The Office of the Superintendent of Financial Institutions (OSFI) continues to actively monitor the evolving pandemic and assess its impacts on the financial and operational capacity of deposit-taking institutions, or DTIs.

ONTARIO STEPS ON TO A SLIPPERY DEBT PATH WITH BUDGET

G&M - Patrick Brethour (2020-11-05)

Ontario’s finances were sustainable, if only narrowly, before the pandemic hit.

U.S. DEBT BURDEN POSES MAJOR CHALLENGE FOR NEXT PRESIDENT

G&M - Patrick Brethour (2020-11-04)

The United States is already on a perilous fiscal path, with unending deficits forecast and the national debt headed to its highest level in the history of the republic by the end of the decade.

THE BANK OF CANADA IS SUPPOSED TO BE INDEPENDENT, BUT IT MIGHT NOT HURT IF IT KNEW WHAT FINANCE WAS UP TO

FP - Kevin Carmichael (2020-11-04)

Those comments will have bothered a lot of people. Poilievre politicized a Crown institution that worries a great deal about its independence from the whims of partisan politics. Much of its credibility relies on the assumption that policy-makers will set interest rates based on economic conditions, not the electoral needs of their political masters.

FISCAL CONSERVATISM VERSUS PONZI NEO LIBRALISM

BankNews.TV - Mark Sibthorpe (2020-11-04)

This video is intended to give viewers an understanding of the economic ideas behind Canada's potential housing bubble. This video also explains why Siddal, President and CEO of the CMHC, was likely pushed from his post.

CANADA MUST MERGE INVESTMENT INDUSTRY REGULATORS, FORMER OSC CHAIRS SAY

G&M - Clare O'Hara (2020-11-04)

This is the view of several former chairs of the Ontario Securities Commission and the current head of the province’s modernization task force, on the future of the two self-regulatory organizations (SROs) that oversee Canada’s investment advisory industry.

LEBANON’S CENTRAL BANK HINDERING EFFECTIVE AUDIT, PREMIER SAYS

Bloomberg - Dana Khraiche (2020-11-03)

SOUTH AFRICA LEANS ON BANKS TO SPUR ECONOMIC RECOVERY

FT - Joseph Cotterill (2020-11-03)

When South African president Cyril Ramaphosa recently extolled in parliament his government’s provision of R500bn ($31bn) to steer the nation’s battered economy through the pandemic, there was some awkward fine print for the country’s banks.

BANK OF ENGLAND FACES NEW DOUBTS OVER POTENCY OF BUYING BONDS

FT - Tommy Stubbington (2020-11-03)

Investors are beginning to question how long the Bank of England can rely on bond buying as its main tool for stimulating the UK economy. Markets are braced for the BoE to announce a fresh round of quantitative easing at its policy meeting on Thursday, with many economists pencilling in an extra £100bn of purchases on top of the £300bn announced so far this year, to tackle the economic impact of a resurgence of Covid-19.

THE MINISTER OF FINANCE SETS COURSE RESOLUTELY FOR WHO KNOWS WHERE

G&M - Andrew Coyne (2020-11-01)

First, the good news. The Finance Minister of Canada is not, contrary to rumours, an advocate of Modern Monetary Theory. Neither is she a disciple of Ayn Rand.

SBA ISSUES GUIDANCE ON CHANGES IN OWNERSHIP AND FULL FORGIVENESS EASED FOR SMALLER LOANS

Banking Exchange - Jeffrey Wagner (2020-11-01)

On October 8, 2020, the SBA and Treasury issued an Interim Final Rule eliminating forgiveness reductions resulting from either a reduction in a borrower's number of full-time equivalent employees or individual employee pay if the borrower's loan (when aggregated with PPP loans to any of its affiliates) does not exceed $50,000.

WHY FEDERAL CONSERVATIVES SHOULD BE CONCERNED ABOUT SASKATCHEWAN'S ELECTION RESULT

CBC - Kory Teneycke (2020-10-30)

Despite these limitations, the Buffalo Party finished third overall in the popular vote and scored strong second-place victories in four bedrock Conservative ridings.

OSC UNVEILS CHARTER FOR OFFICE TO PROMOTE INNOVATION AND REDUCE REGULATORY BURDEN

FP - Barbara Schecter (2020-10-30)

A charter unveiled Thursday by a newly created branch of the Ontario Securities Commission lays the groundwork for new forms of capital raising, more avenues for innovators and a reduced regulatory burden.

BANK OF CANADA OUTLOOK SIGNALS THE LEGACY OF COVID-19 CRISIS WILL LINGER FOR YEARS

FP - Kevin Carmichael (2020-10-29)

The Bank of Canada is setting up to run a high-pressure economy until at least 2023, a delicate operation that will require lots of tinkering along the way.

BANK OF CANADA GOVERNOR SAYS DIGITAL DOLLAR PROJECT MOVING PAST TRIAL STAGE

Coindesk - Sebastian Sinclair (2020-10-29)

In an interview with Reuters published Thursday, Bank of Canada (BoC) Governor Tiff Macklem said his institution is working with G7 member states on its plans for a central bank digital currency (CBDC).

ANCHORS AWEIGH!

FP - Terence Corcoran (2020-10-28)

The last monetary report in July was a grim synopsis of looming economic decline. To quote one passage: “The large declines in both demand and supply are extraordinary. Over a longer horizon, the pandemic could cause large and lasting changes in consumer preferences and other sources of demand. Similarly, the scope of possible structural changes to a post-pandemic economy is vast, and the timing of adjustments will remain unknowable as long as COVID-19 continues to be a threat.”

BANK OF CANADA TO REINFORCE LOW FOR LONG: DECISION-DAY GUIDE

Bloomberg - Shelly Hagan (2020-10-28)

BANK OF CANADA TO REDUCE BOND PURCHASES, RECALIBRATE PROGRAM AS RECOVERY ENTERS LESS CERTAIN PHASE

G&M - DAVID PARKINSON (2020-10-28)

The Bank of Canada said it will reduce its Canadian government bond purchases to $4-billion a week while shifting more of its purchases to longer-term bonds, as the bank recalibrates its quantitative easing to deliver stimulus to an economy that it cautions is headed into a slowing and less certain phase of recovery.

BANK OF CANADA RATE ANNOUNCEMENT

Central 1 - Helmut Pastrick (2020-10-28)

The Bank of Canada’s monetary stance was little changed following today’s announcement except for an adjustment to its bond-buying program. The Bank is focusing on longer-term bond maturities, which have more infl uence on household and business borrowing costs, than shorter-term bonds and treasury bills. In addition, their weekly bond purchases will be reduced to four billion per week from fi ve billion. The Bank purchased shorter-term fi nancial assets in the early stage of the pandemic to provide liquidity to the market but that is no longer required and the Bank’s shift to longer-term bonds is intended to support and promote economic growth.

CANADIAN NEWS PUBLISHERS CALL ON GOVERNMENT TO TAKE ON GOOGLE/FACEBOOK, URGE ADOPTION OF THE AUSTRALIAN MODEL

G&M - Josh O'Kane (2020-10-26)

Canadian news publishers want government approval to seek compensation from digital giants such as Facebook Inc. and Alphabet Inc.'s Google for using their content, including the power to bargain as an industry to negotiate the terms.

BUSINESS ON BIDEN: NOT SO BAD, GIVEN THE ALTERNATIVES

WSJ - Greg IP, Ken Thomas (2020-10-26)

Many executives see the Democratic nominee as less adversarial than Sanders or Warren, and less unpredictable than Trump. Yet political attitudes vary considerably by industry and type of business.

ALL THE PRESIDENT’S DEBTS: TO WHOM TRUMP OWES MONEY

FT - Robert Armstrong, Joe Rennison (2020-10-26)

These are tough times in the real estate market. The Covid-19 crisis has hit asset values, particularly commercial real estate in cities such as New York. Investors holding debt with upcoming maturities are preparing for tricky negotiations with their debtors. The negotiations will be trickier if the debtor is the president of the United States.  Virtually all of Donald Trump’s debt — there is at least $1.1bn of it, according to his government financial disclosures and other documents — is backed by real estate, mostly linked to a small number of buildings and golf courses that form the core of the Trump business empire. About $900m of that debt will come due in Mr Trump’s second term, should he win the November 3 presidential election. 

MARKETS WAIT FOR POLICY HINTS IN BANK OF CANADA’S INTEREST RATE DECISION

G&M - DAVID PARKINSON (2020-10-26)

Balancing a stronger-than-expected economic rebound with a second wave of the COVID-19 pandemic, the Bank of Canada looks unlikely to make any dramatic moves in this week’s monetary policy decision. But the financial markets will nevertheless be looking for hints on where the central bank will take its highly stimulative policy position from here.

BANK OF CANADA ALREADY PUSHING THE LIMITS OF THE DOMESTIC BOND MARKET

FP - Theophilos Argitis (2020-10-26)

Market operation data from the Bank of Canada show benchmark bonds — those currently being sold by the government, as opposed to older debt — are making up a growing share of the central bank’s secondary market purchases.

TIME FOR BOC TO PULL BACK ON QE, NBF SUGGESTS

Investment Executive - James Langton (2020-10-26)

In a research note, NBF said the bank’s policy rate is expected to remain at its rock-bottom level of 0.25% at its rate decision on Wednesday, and likely until 2023 at least.

GOVERNMENT SPENDING IS BECOMING A PROBLEM AND PRINTING MONEY IS A DANGEROUS SOLUTION

FP - Martin Pelletier (2020-10-22)

That appears to be the case here in Canada, where the Liberal minority government — backstopped by the NDP — is looking to implement massive, costly programs including a national daycare system, pharmacare, affordable housing and green initiatives.

ANALYSIS: BIDEN TAX INCREASE MIGHT NOT BE SO BAD FOR BIG BANKS

Reuters - David Henry (2020-10-22)

Banks were big beneficiaries of tax cuts under President Donald Trump, making a reversal seem ominous. But a second look at what might happen if Biden were to win the election and Democrats were to win control of the U.S. Senate suggests the pain might not be so bad.

TRUDEAU GOVERNMENT SHOULD HEED LOOMING RISKS TO FEDERAL FINANCES

G&M - JASON CLEMENS AND MILAGROS PALACIOS (2020-10-22)

The federal government and several prominent economists have played down the near-term risks to federal finances. Some have actually characterized Ottawa’s financial position as basically “sound.” Such analyses are premised on questionable assumptions and ignore the country’s past experiences with perennial deficits.

U.K. GOVERNMENT BORROWING HITS RECORD

Investment Executive - AP (2020-10-22)

The government borrowed a net 36.1 billion pounds (US$47.1 billion) in September, pushing the total for the first six months of the year to 208.5 billion pounds, the Office for National Statistics (ONS) said Wednesday. That’s the highest figure since records began in 1993.

GOVERNMENT SPENDING PLANS WOULD PUSH FEDERAL DEBT BURDEN BACK TO 1990S LEVELS, DRUMMOND WARNS

G&M - Patrick Brethour (2020-10-20)

The Liberal government’s expansive spending plans would push the federal debt burden back to the dangerous levels of the 1990s over the next decade, according to a report from one of the architects of Ottawa’s successful effort to defuse Canada’s debt crisis a quarter century ago.

LIBERALS THREATEN ELECTION IF PROPOSED ‘ANTI-CORRUPTION’ COMMITTEE IS DEBATED

G&M - MARIEKE WALSH, PAUL WALDIE (2020-10-20)

The Liberals are threatening opposition parties with an election if the Conservatives move ahead Tuesday with their attempt to create a special “anti-corruption” committee in the House of Commons.

U.S. JUSTICE DEPARTMENT FILES LANDMARK ANTITRUST CASE AGAINST GOOGLE

G&M - MICHAEL BALSAMO AND MARCY GORDON (2020-10-20)

The Justice Department on Tuesday sued Google for antitrust violations, alleging that it abused its dominance in online search and advertising to stifle competition and harm consumers.

TRUDEAU DARES OPPOSITION TO FIGHT ELECTION AMID SECOND COVID WAVE

Bloomberg - Kait Bolongaro (2020-10-20)

Justin Trudeau warned opposition lawmakers they will trigger an election in Canada if they approve the creation of an “anti-corruption” committee.

INFLATION NUMBERS REALLY ARE BEING DISTORTED BY COVID-19 SPENDING, NEW RESEARCH SHOWS SOCIAL SHARING

CBC - Don Pittis (2020-10-19)

New research by two of Canada's most credible analytic agencies appears to prove that critics — who have complained that inflation data has been distorted by COVID-19 both here and in the U.S. — actually got it right.

BANK OF CANADA PHASING OUT 3 PROGRAMS SET UP IN EARLY DAYS OF COVID-19 TO PROVIDE EMERGENCY LIQUIDITY

CBC - CBC (2020-10-19)

The mortgage bond program accomplished this by having the central bank buy up billions of dollars worth of insured mortgages from lenders and move them on to its balance sheet, which makes it easier for lenders to go out and lend money to someone else.

THE PROBLEM WITH CANADA'S MONETARY POLICY REGIME

FP - Kevin Carmichael (2020-10-19)

The Bank of Canada’s mandate is up for renewal next year, and this time will be different. The central bank has set a new standard for how an arm’s length Crown corporation should engage with the people it ultimately serves.

TRUDEAU IS PREPARING TO TEST LIMITS OF DEBT-FINANCED SPENDING

Bloomberg - Kait Bolongaro and Theophilos Argitis (2020-10-19)

Justin Trudeau’s Covid-19 support programs gave Canada one of the world’s largest budget deficits, and now the prime minister is ready to test public appetite for more red ink.

FED, CENTRAL BANKS WILL FIND EXIT FROM MASSIVE STIMULUS IMPEDED

Bloomberg - Rich Miller (2020-10-19)

The Federal Reserve and other central banks will eventually discover that breaking up isn’t easy after partnering with their governments and the financial markets to avert a pandemic-driven depression.

THE DIGITAL CURRENCY ARMS RACE: CENTRAL BANKS ENTER THE FRAY TO PROTECT NATIONAL SOVEREIGNTY

G&M - Barry R Campbell (2020-10-19)

A group of seven central banks, including Canada’s, have issued a statement indicating they are working together on common principles and key features for a viable central bank digital currency, or CBDC.

MONETARY POLICY: WHAT DOES THE FUTURE HOLD

Investment Executive - Alizee Calza (2020-10-19)

Every five years, the Bank of Canada renews its agreement on the country’s inflation-control target. The BoC is due to announce its new framework in 2021, and this time around, it has asked Canadians for their opinions.

BANK OF CANADA STEPS UP FINANCIAL BENCHMARK OVERSIGHT

Investment Executive - James Langton (2020-10-19)

In a release, the bank said that while new risk-free rates (such as CORRA) are expected to become the primary financial benchmarks around the world, they are not necessarily ideal for all products, “so having robust credit-sensitive benchmarks may also be desirable,” it said.

OSFI REVIEWING ITS ANTI-MONEY LAUNDERING RULES

Investment Executive - James Langton (2020-10-19)

OSFI said this new approach to AML supervision reflects an effort to “eliminate duplication” and reduce the regulatory burden.

US 2020 ELECTION: THE ECONOMY UNDER TRUMP IN SIX CHARTS

BBC - BBC (2020-10-19)

Reality Check verdict: It's true the economy was doing well prior to the pandemic - continuing a trend which began during the Obama administration - but there have been periods when it was much stronger.

BANK OF CANADA BECOMING ‘ATM FOR TRUDEAU,’ CONSERVATIVES CAUTION

Bloomberg - Theophilos Argitis and Kait Bolongaro (2020-10-16)

Canada’s main opposition party is cautioning the central bank against financing Justin Trudeau’s spending plans beyond immediate pandemic emergency measures, thrusting the Bank of Canada into a political firestorm.

CANADA INFRASTRUCTURE BANK PAID $3.8-MILLION FOR TERMINATIONS AMID LEADERSHIP SHAKEUP

BILL CURRY AND CHRIS HANNAY - Canada Infrastructure Bank paid $3.8-million for terminations amid leadership shakeup (2020-10-14)

The Canada Infrastructure Bank paid $3.8-million in termination benefits as part of a major shakeup of the organization’s senior management, documents show.

IMF HEAD WARNS AGAINST PULLING PLUG TOO EARLY ON COVID-19 SPENDING

G&M - Reuters (2020-10-14)

The IMF forecasts a partial and uneven recovery in 2021, with global growth expected to reach 5.2 per cent, but warns that significant risks remain, including the resurgence of the virus.

IMF SAYS PUBLIC DEBT SOARING TO NEARLY 100% OF GLOBAL GDP AS GOVERNMENTS SPEND TO BATTLE CORONAVIRUS

G&M - David Lawder (2020-10-14)

Massive government spending to battle the coronavirus pandemic will push public debt to a record of nearly 100 per cent of global economic output this year, but the run-up may be a one-off event if growth rebounds next year, the International Monetary Fund said on Wednesday.

CENTRAL BANKS MUST MOVE FASTER ON DIGITAL CURRENCIES AMID COVID-19, BANK OF CANADA SAYS

CBC - CP (2020-10-14)

A Bank of Canada official says pandemic-related shifts in how people shop means central banks must speed up work on creating their own digital currencies.

'BANK WATCHERS' SHOW WHY BANK OF CANADA IS TAKING COMMUNICATIONS INTO OWN HANDS

FP - Kevin Carmichael (2020-10-14)

“Relying on the conventional media to diffuse their message to the public can be ineffective because many households no longer read newspapers and even if they do, individuals discount reports from the news media,” the authors said in their paper.

BANK OF CANADA IS CLOSE TO ITS POLICY LIMITS, POLOZ SAYS

FP - Shelly Hagan (2020-10-13)

The former governor, who stepped down from the Bank of Canada after his term ended in June and is currently a special adviser at law firm Osler, Hoskin and Harcourt LLP, cited a report on Tuesday by the International Monetary Fund that estimated Canada’s general government gross debt will rise to 115 per cent of gross domestic product this year, from 89 per cent in 2019. Policy makers don’t have much experience with such large numbers, but provided interest rates stay low, it’s more of a “debt service issue,” Poloz said.

WAYS TO DEFUSE CURRENCY WARS

Reuters - Mark Sobel (2020-10-13)

Earlier this year, the U.S. Commerce Department issued a regulation that allows duties to be applied on imports from countries whose currencies are deemed to be undervalued. Already, with the help of a Treasury Department undervaluation finding against the Vietnamese dong, Commerce is pursuing such a case against Vietnamese tires. A Treasury finding in a Chinese tie-twist case may soon be reached. Others may be next in line.

CANADA BOND SALES FACE TICKING CLOCK AS U.S. ELECTION NEARS

Bloomberg - Esteban Duarte (2020-10-13)

ADVANCED GOVERNMENTS ACT AS THOUGH THERE'S 'NO COST TO DEBT' AND IT 'WON'T END WELL'

Sky News - Video (2020-10-13)

The advanced governments of the world are conducting an extraordinary economic experiment and think there’s no cost to debt, but “it’s not going to end well”, according to the Australian’s Adam Creighton.

GET READY FOR FULL BREXIT TO KICK IN, U.K. GOVERNMENT URGES BUSINESSES

G&M - Reuters (2020-10-12)

Britain’s government on Sunday urged businesses to prepare for the end of the Brexit transition period, saying that they need to take action whether or not a trade deal with the European Union is clinched.

BANK OF ENGLAND ASKS BANKS HOW READY THEY ARE FOR SUB-ZERO RATES

G&M - HUW JONES AND WILLIAM SCHOMBERG (2020-10-12)

The Bank of England asked banks on Monday how ready they are for zero or negative interest rates, following up its announcement last month that it was considering how to take rates below zero if necessary.

GLOBAL WATCHDOGS AGREE RULES FOR STABLECOINS LIKE FACEBOOK'S LIBRA

Reuters - Huw Jones (2020-10-12)

Central banks set out to regulate cross-border stablecoins like Facebook’s planned Libra with a common approach on Tuesday, saying more rules may later be needed to ensure stability.

NEXT BIG SHIFT IN ECONOMICS TAKES SHAPE UNDER COVID SHADOW

Bloomberg - Alaa Shahine (2020-10-12)

A rare regime-change in economic policy is under way that’s edging central bankers out of the pivotal role they have played for decades.

BOC’S MACKLEM WARNS COMING MONTHS ‘CRUCIAL’ IN GAUGING HOW CANADIAN HOUSEHOLDS, BUSINESSES WEATHER COVID-19 CRISIS

G&M - DAVID PARKINSON (2020-10-08)

Bank of Canada Governor Tiff Macklem acknowledged that the central bank’s adoption of record-low interest rates to fight the COVID-19 economic crisis has elevated the country’s financial risks, warning that “the next few months will be crucial” in determining how well Canadian households and businesses weather the strains from the crisis.

FOR THE BANK OF CANADA, WHAT DOES THE LINK BETWEEN MONETARY POLICY AND INEQUALITY MEAN?

G&M - Jeremy Kronick (2020-10-08)

A global pandemic that has crushed the economy. A stock market improbably rising in an economic downturn. Is it the job of the Bank of Canada to address this contradiction, and the inequality that arises?

CHINA AIMING FOR FIRST-MOVER ADVANTAGE IN BUILDING DIGITAL CURRENCY, ACCORDING TO JAPANESE OFFICIAL

G&M - Iain Withers, Anna Irrera, Tom Wilson (2020-10-08)

China is seeking to win a first-mover advantage in its efforts to develop a digital version of its currency, Japan’s top financial diplomat said on Thursday.

PATH TO RECOVERY LITTERED WITH DEBT RISKS, BANK OF CANADA GOVERNOR WARNS

FP - Kevin Carmichael (2020-10-08)

“As much as a bold policy response was needed, it will inevitably make the economy and financial system more vulnerable to economic shocks down the road,” Tiff Macklem said in a speech on Oct. 8.

BANK OF CANADA KEEPS DOOR OPEN TO POSSIBILITY OF NEGATIVE RATES

Bloomberg - Shelly Hagan (2020-10-08)

“We are not actively discussing negative interest rates at this point but it’s in our toolkit and never say never,” Macklem said Thursday via videoconference, after a speech to the Global Risk Institute.