Money: Rate Cuts Are No Panacea in a Trade War, Warns Bank of Canada - PressFrom - Canada
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MoneyRate Cuts Are No Panacea in a Trade War, Warns Bank of Canada

12:05  11 july  2019
12:05  11 july  2019 Source:   msn.com

Deutsche Bank considering up to 20,000 job cuts, WSJ reports

Deutsche Bank considering up to 20,000 job cuts, WSJ reports Deutsche Bank considering up to 20,000 job cuts, WSJ reports

Also from Citi, Tony Larkin warns that rate cuts are not a panacea “Central Bank stimulus is no Panacea . Rate cuts /QE, assuming timed correctly and sufficiently outsized, would seek And it is not just the deepening negative impact of trade wars , many economies were already struggling to grow.

Jean-Claude Juncker pledges retaliation as EU companies face 25% tariffs on steel and 10% on aluminiumTrump imposes tariffs – business live.

Rate Cuts Are No Panacea in a Trade War, Warns Bank of Canada© Chris Wattie Bank of Canada Governor Stephen Poloz (Bloomberg) -- Investors may think central banks can prevent a trade war-induced recession by cutting interest rates, but it’s never that simple, says Bank of Canada Governor Stephen Poloz.

Responding to a reporter’s question about the limits of monetary policy when dealing with trade tensions, Poloz replied it’s not as easy as lowering borrowing costs.

“My sense is that the markets are not really on to the complexity of it,” Poloz said. “It seems a little too easy that interest rates could decline and that makes everything OK.”

Poloz spoke as U.S. stocks hit a fresh all-time high after Fed Chair Jerome Powell solidified bets for an interest rate reduction at the end of the month, and with global and Canadian shares not far off records. That’s precisely the kind of perverse reaction Poloz finds disconcerting.

Why Canada won't necessarily follow any U.S. rate cuts: Kevin Carmichael

Why Canada won't necessarily follow any U.S. rate cuts: Kevin Carmichael A lot of people assume the Bank of Canada will tag along if and when the U.S. Federal Reserve goes in a new direction. “There is a 90 per cent correlation between U.S. and Canadian monetary policy, so of course the Bank of Canada will follow,” David Rosenberg, the ubiquitous chief economist at Gluskin Sheff + Associates Inc., a Toronto-based investment firm, told BNNBloomberg earlier this month when asked if a Fed interest-rate cut would be matched by the Bank of Canada. But the relationship isn’t as automatic as Rosenberg’s comment makes it sound. Yes, Canadian interest rates track American borrowing costs because the two economies are so entwined. If the U.S.

The IMF said: “Escalating trade tensions and the potential shift away from a multilateral, rules-based trading system are key threats to the global outlook. In a further swipe at Trump, the IMF said countries needed to work together to tackle challenges that extended beyond their own borders.

Browse and filter Bank of Canada publications by author, JEL code, topic and content type. Deputy Governor Lawrence Schembri explains how Canada ’s monetary policy framework—inflation targeting underpinned by a flexible exchange rate —has proved to be the most durable in the post-war period.

An escalation in trade tensions looks to be on the minds of bond investors, but stocks are shrugging off this possibility, according to Canada’s central bank chief.

“To put a fine point on it, the bond market pushes yields down and the stock market goes back as if nothing bad’s going to happen,” he said. “And yet the underlying shock would be clearly very bad for economic growth, would be bad for the level of productivity, would be quite harmful to profitability.”

The Bank of Canada left its policy rate unchanged at 1.75%, citing ongoing trade uncertainty hindering growth, despite a rebound in recent economic data. The Monetary Policy Report released by the central bank shed further light on these mixed signals sent by financial markets.

Bank of Canada to give economic update, expected to be patient on rates

Bank of Canada to give economic update, expected to be patient on rates OTTAWA - Bank of Canada governor Stephen Poloz will share his latest take on the economy Wednesday in an update that’s expected to signal more patience on the key interest rate. 

Bank of Canada (BOC) governing council members come to a consensus on where to set the rate . Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation. (Bloomberg) -- As the Bank of Canada meets this week amid trade - war chaos

The Bank of Canada today maintained its target for the overnight rate at 1 ¾ per cent. However, there are increasing signs that the US-China trade conflict is weighing on global demand and The appropriate pace of rate increases will depend on how the outlook evolves, with a particular focus on

The inversion of the Canadian and U.S. yield curves may be benign, but “nonetheless reflect a concern about the prospects for growth,” according to policy makers. On the other hand, “robust equity prices and tight credit spreads suggest that economic growth will continue in the near term.”

To contact the reporters on this story: Shelly Hagan in New York at [email protected];Luke Kawa in New York at [email protected]

To contact the editors responsible for this story: Theophilos Argitis at [email protected], Chris Fournier, David Scanlan

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.

Central bank qualifying rate used in mortgage stress tests falls.
OTTAWA — The Bank of Canada's rate used by mortgage stress tests to determine whether would-be homeowners can qualify has dropped for the first time in three years. The central bank's five-year benchmark qualifying rate is now 5.19 per cent, down from 5.34 per cent. It's the first decrease in the five-year fixed mortgage rate since September 2016, when it dropped from 4.74 per cent to 4.64 per cent, and increased steadily since. The qualifying

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