In its quarterly Business Outlook Survey published on Monday, the Bank of Canada said about half of polled firms expect Canada to go into a mild recession over the next year, down from roughly two-thirds in the previous survey, per Reuters.
Additional takeaways
"79% of firms expect inflation to remain above 3% for the next two years, down from 84% in Q4."
"59% of firms expect inflation to stay well above 2% until at least 2025."
"For 5th consecutive quarter, businesses anticipate sales growth to slow; slowdown follows period of exceptional strength over the past year."
"Businesses link expectations of weaker sales growth to rate hikes, high inflation and concern over a recession."
"Although surveys were conducted before global banking stresses emerged in early March, evidence suggests business sentiment has not changed much since then."
"Firms continue to view labor market as tight, although labor shortages and wage growth pressure have eased."
"Firms expect size and pace of output prices to moderate; this suggests firms are gradually shifting closer to normal price-setting practices."
"Separate BOC Q1 survey on consumer expectations shows 20.3% of Canadians expect significant economic decline in next 12 months, 37.7% expect small decline."
"Expectations for 1-year ahead inflation fell to 6.03% from 7.18% in Q4; 2-years ahead inflation expectations drop to 4.27% from 5.14%."
"Expectations for 5-year ahead inflation have edged down to 2.92% from 3.10%."
Market reaction
The USD/CAD stays under bearish pressure and was last seen losing 0.6% on the day at 1.3437.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD consolidates above 0.6600 amid risk-on mood/hawkish RBA
AUD/USD holds steady above 0.6600 on Friday. Thursday's stronger US macro data eased fears of a slowdown in the world's largest economy and boosted investors' confidence. Moreover, the RBA's hawkish outlook lends support to the Aussie. a modest USD strength, bolstered by reduced bets for aggressive policy easing by the Fed, acts as a headwind.
EUR/USD blinks on Thursday, falls back below 1.1000
EUR/USD took a dive back below the 1.1000 handle on Thursday despite a broad-market recovery in investor sentiment. US Retail Sales growth lurched to an 18-month high of 1.0% MoM in July, well above the forecast 0.3% and entirely engulfing the previous month’s -0.2% contraction.
Gold holds steady above $2,450 on positive Retail Sales data
Gold price flat lines near $2,455 during the early Asian session on Friday. The yellow metal seesaws between gains and losses amid the consolidation of the US Dollar. Traders will focus on the preliminary of the US Michigan Consumer Sentiment Index for August, along with the Building Permits and Housing Starts.
Uniswap unveils $2.5 million security pool for v4 upgrade amid most UNI coins held at loss
Uniswap has launched a $2.35 million prize pool for researchers to audit its upcoming v4 codebase. Uniswap v4 will introduce several new features, including on-chain limit orders and flash accounting. UNI's price may have bottomed, with 77% of coins held at a loss.
Investors feeling good about Goldilocks economy
We’re back to talking about soft landings and a Goldilocks economy. First it was a softer run of US inflation data that helped to encourage the prospect for more investor friendly Fed policy going forward. Then it was the combination of hot and cold Thursday US data.