TEC Canada is pleased to provide the monthly Andersen Economic Report exclusively to our members to offer professional updates on the current economic environment in Canada, the USA, and globally. As the former assistant chief of the Bank of Canada’s research department, Dr. Peter Andersen provides valuable economic insight to help you make better business decisions.
October 2023 PREVIEW:
Canada | Rising Employment Signals Economic Growth, Concerns Over High Wage Increase, and Bank of Canada Expected to Raise Rates
Canada’s employment rebound indicates economic growth, with the 2nd quarter GDP decline attributed to reversible factors such as wildfires and work stoppages. Job growth has been robust in August and September, but high wage growth at 5.0% y/y in September, above the Bank of Canada’s target, is a concern. The Bank of Canada is likely to increase its policy rate in October to address inflation, and this, along with tightening lending standards, may lead to an economic stall-out in 2024, impacting mortgage renewals and credit card usage.
United States | Economy Set for 2024 Slowdown, Companies Prioritizing Employee Retention, and Growing Concerns Over Wage Demands and Inflation Threat
Following a robust 3rd quarter, the US economy is poised for a slowdown in the first half of 2024 due to high interest rates and limited credit. This deceleration is expected to be driven by reduced spending on consumer goods and services, with companies focusing on retaining employees rather than layoffs. A significant concern is that rising wage demands, reflecting higher living costs, could trigger a second round of inflation despite stabilizing monthly prices.
Global Economic Outlook | Concerns Over Global Economic Growth and Inflation, China’s Economic Slowdown Impacts Commodity Prices, Oil Price Volatility and Sustained Diesel Price Strength
Global economic growth forecasts are being lowered due to persistent core inflation issues, leading to potential central bank rate hikes. Projections indicate that global GDP growth will be below 3.0% in 2024 and 2025, a notable drop from the past decade’s 3.7% average. China’s economic recovery is slowing to around 4.0% in 2024, affecting commodity prices like copper and oil. While oil prices have dipped from recent highs, they might rebound due to Saudi Arabia’s production cuts, possibly reaching $90. Diesel prices remain higher than expected.
Excited to delve into the full October 2023 Andersen Economic Report? As a valued member of TEC Canada, you can access the complete report under the ‘Resources’ section of the TEC Canada App!
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