• 2020-04-15 10:39

    By Greg Quinn

    OTTAWA (MNI) - Good morning. Senior Deputy Governor Wilkins and I are glad to have the opportunity to answer your questions about today's policy announcement and Monetary Policy Report (MPR). Allow me to begin with a few comments.

    The Canadian economy is experiencing a significant and rapid contraction. The shock is a global one, affecting all countries, but commodity-producing countries like Canada are being hit twice. In the very near term, policy-makers can do little more than cushion the blow.

    It is worth spending a moment to emphasize why the central bank's inflation targets matter so much, even at a time such as this. Inflation targets were put in place around the world when the dominant worry was higher inflation.

  • 2020-04-15 10:00

    By Greg Quinn

    OTTAWA (MNI) - Here are key passages from the Bank of Canada's Monetary Policy Report, published Wednesday in Ottawa:

    *The Bank has used scenario analysis to estimate the level of real GDP to be about 1 to 3 and 15 to 30 percent lower in the first and second quarters of 2020, respectively, than in the fourth quarter of 2019.

    *Despite a high level of uncertainty, these estimates suggest that the near-term downturn will be the sharpest on record.

    *The direct and indirect effects of COVID-19 will weigh heavily on consumer price index (CPI) inflation in the coming months, which is expected to slump to close to 0 percent in the second quarter of 2020.

    *The Bank has used scenario analysis to estimate the level of real GDP to be about 1 to 3 and 15 to

  • 2020-04-15 08:36

    By Greg Quinn

    OTTAWA (MNI) - Following is the text of Statistics Canada's release Wednesday of a flash GDP estimate for March:

    The gross domestic product (GDP) is a core economic measure of the health of the Canadian economy. Typically, Statistics Canada releases these data about two months after the end of the reference period. The most recent monthly release, for instance, highlighted GDP for the January reference month.

    Given the unique situation faced by the Canadian economy in the context of the COVID-19 pandemic and the demand for trusted information on the aggregate impact of this health crisis on the economy, Statistics Canada has produced a flash estimate of monthly GDP for March.

  • 2020-04-10 15:54

    --Repos Eclipse Target Of CAD5B A Week in Federal Government Securities

    OTTAWA (MNI) - The Bank of Canada's balance sheet grew to a record CAD275.2 billion as of April 8 from CAD215.6 billion a week earlier, led by a surge in emergency repo agreements.

    Assets on the central bank's balance sheet have nearly doubled from CAD154.1 billion two weeks ago, far more than during the global financial crisis.

    The BOC cut interest rates to 0.25% March 27 and set a weekly target of CAD5 billion of Canadian government securities purchases. Governor Stephen Poloz signaled asset purchases are now the driver of monetary policy because he doesn't think negative interest rates will be effective in stabilizing financial markets.

  • 2020-04-06 10:30

    By Greg Quinn

    OTTAWA (MNI) - Following are BOC special survey questions on the impact of the coronavirus pandemic on consumer and energy companies. They were published Monday as a supplement to a business survey mostly taken before health shutdowns escalated.

    Box 1: Consumer-oriented firms reported a collapse in sales due to COVID-19 To better understand the quickly evolving economic impacts of COVID-19, the Bank conducted phone consultations with a small, targeted sample of Canadian firms and industry associations between March 13 and 17.1 The impact of the shock on firms was still escalating, with some firms seeing very recent sharp declines in demand and others only expecting them.

  • 2020-04-06 10:30

    --Special Questions Added After Standard Surveys Missed Rise In Shutdowns

    OTTAWA (MNI) - The BOC said energy companies struggled to finance operations and consumer companies saw sales evaporate in mid-March as the coronavirus pandemic widened.

    The Bank on Monday published special questions it posed to a small group of companies, following up on regular quarterly surveys that were taken before health shutdowns intensified. The special questions were asked of a "small, targeted sample of Canadian firms and industry associations" from March 13-17.

    "Consumer-oriented firms reported a collapse in sales due to COVID-19," the report said.

  • 2020-04-02 15:31

    --Finance Minister Touts His Bigger Payments To Neediest

    OTTAWA (MNI) - Canadian Finance Minister Bill Morneau said his country's plan to send larger COVID-19 relief payments to the neediest families will be more effective than what the U.S. is doing.

    "Many people will have seen that the United States for example is talking about sending a check for twelve hundred dollars to every American," Morneau told the House of Commons finance committee Thursday. "We came to the conclusion quite rapidly that sending a modest amount like that to every Canadian is not nearly as advantageous as sending more money to those people who are actually impacted by COVID-19."

    The U.S.

  • 2020-04-02 09:01

    --Trade Deficit Improvement On Aircraft and Car Exports Likely to Fade

    OTTAWA (MNI) - Canada's trade balance showed a surprise improvement in February, a month when the early restrictions around COVID-19 were taking hold and protests blocked railway shipments.

    The trade deficit narrowed to CAD983 million from CAD1.7 billion in January, Statistics Canada said Thursday from Ottawa. The MNI economist median was for a widening to CAD2.2 billion.

    Trade data will likely worsen in March as major auto factories shut down, energy prices were volatile and the aviation industry was roiled by travel warnings, Statistics Canada said.

  • 2020-04-01 06:30

    By Greg Quinn

    OTTAWA (MNI) - Canada's central bank ramped up its publication of notices to financial markets in March as it sought to keep trading liquid through the COVID-19 pandemic.

    The Bank of Canada posted 36 notices on the month, the highest amount since the 38 notices published in March 2009, the height of the financial crisis, according to records back to 2000 reviewed by MNI.

    The balance tips towards more updates delivered this March than in 2009 if you count three regular press releases devoted to touting new market tools.

  • 2020-03-27 09:42

    (MNI) - The following is the text of Friday's announcement from the Bank of Canada's plan to purchase government securities in the secondary market:

    As announced on March 27 2020, the Bank of Canada is launching a program to purchase Government of Canada securities in the secondary market. This program is intended to address strains in the Government of Canada bond market and to enhance the effectiveness of all other actions taken so far.

    The effective start date is 1 April 2020. Program details are as follows:

    * Purchases will begin with a minimum of $5 billion per week across the yield curve.