There was growing talk of the "R-word" (recession) leading up to today's GDP data release, given the third quarter could have marked the second straight month of negative growth.
Following the release of weaker-than-expected October inflation data, markets are growing more confident that the Bank of Canada's rate-hike cycle is officially over.
Canadian interest rate are about 200 basis points higher than it otherwise would be due to government spending at all levels, including billions spent on pandemic relief.
Canada's unemployment rate ticked up two basis points to 5.7% in October, suggesting the Bank of Canada can now remain "firmly on the sidelines," economists say.
Canada's economic growth has flatlined for the second straight month, and has now undershot expectations for the past five months.
With Canada's headline inflation rate once again trending downward, next week's Bank of Canada rate decision is now looking decidedly more like a rate hold.
CIBC deputy chief economist Benjamin Tal said that while we're are very close to the end of Bank of Canada rate hikes—or maybe already there—the biggest question is when the Bank will being cutting rates.
The Bank of Canada says larger and more frequent price increases by businesses have contributed to keeping inflation higher than the Bank would like.
Canada's economic activity in July was unchanged from the previous month, marking the second straight month of weak GDP results.
In its economic and housing outlook released today, Oxford Economics is forecasting a mild recession by the end of the year will lead to an additional 10% decline in average house prices by early next year.
