This Week’s Economic Highlights – October 4

TD Canada Trust provides a weekly economic highlight report that we choose to share with our clients and those who follow us. This is an easy place to stay current on the broader economic conditions in Canada and the U.S. so that you are better informed to make stronger decisions around your own real estate investments. We are always available to answer any questions or walk through your real estate investment goals for now or in the future.

Full Details of the TD Canada Trust Economic Highlights Here

Canadian Highlights

  • A run of gloomy U.S. data sent chills through financial markets. Canadian markets were caught in the downdraft, with equities, bond yields and the dollar all lower in the week.
  • It was another week of mixed data. July GDP growth was flat, though dragged down by temporary factors. Toronto and Vancouver home sales were positive, on balance and international trade data did little to alter our Q3 growth tracking.
  • Although domestic data is generally meeting expectations, weaker external conditions could force the Bank’s hand.

U.S. Highlights

  • October began on a sour note. A deepening contraction in the manufacturing ISM confirmed that the global manufacturing slump has washed up on American shores, and the sectoral weakness may be spreading into other industries.
  • The jobs report offered some encouragement, even as the details were not entirely positive. Payrolls rose a decent 136k and the unemployment rate fell to a 50-year low at 3.5%. Still, wage growth cooled, dipping below 3% y/y.
  • Trade developments remained top of mind. After getting the okay from the WTO, the U.S. plans to apply tariffs on $7.5 bn of EU goods in mid-October. This is around the same time it plans to increase the tariff rate on $250 bn of Chinese goods. This increases the chances of tit-for-tat measures, which would expedite the slowdown in global growth.