Hard landing ahead

Canada is headed for a moderate recession beginning next quarter mainly due to rising interest rates, according to an economic forecasting model developed by Oxford Economics.

Driving the news: There’s now a 63% chance of a recession in the next six months, according to the model, a probability threshold that has been passed in four of Canada’s six most recent recessions.

What the languishing loonie means for you

Congratulations to anyone with any US dollars sitting around from that last trip down south, because the currency is on a tear. 

The loonie is sitting at its lowest levels against the US dollar in two years as rising geopolitical tensions, specifically Russia’s not-so-subtle nuclear threats and military mobilization, leave investors looking for safe places to park their money. 

Inflation's down

Canadian consumer prices fell 0.3% last month, the biggest monthly drop in two years. 

Central banks' Goldilocks problem

Central banks around the world have a tall task ahead of them: get the economy running not too hot, not too cold, but just right—or risk plunging the world into a historic recession.

That’s the message the World Bank is sending in a report documenting the risks presented by the most dramatic and widespread tightening of monetary policy since the 1980s (but no pressure, or anything). 

Why it matters: Inflation hurts, but a worldwide recession would be no picnic either—the World Bank estimates it would set the global economy back around 6 years, with GDP not reaching the pre-COVID 2024 forecast until the end of the decade.

US Inflation Day

Higher-than-expected US inflation numbers have cleared the runway for the Federal Reserve to deliver another big rate hike—a realization that has sent markets into shock. 

Back to square one for investors

If you’re kicking yourself over a bad stock pick recently, we’re here to tell you that #1, who isn’t, and #2, even bonds—one of the safest (some would say boring) investments—is losing money this year, with a key index that tracks the asset dropping 16.8% since January.   

What higher unemployment means for you

Canada’s unemployment rate is up for the first time in seven months, which means that high interest rates have (done what they do and) thrown cold water on the red hot labour market.

The super-rich love superyachts

Speaking of the wealthy doing most of the spending, the yacht rental business is booming.

Here comes the dental plan

The federal government is planning to announce relief measures aimed at helping low-income Canadians beat back inflation pains. 

What happened: The measures are expected to temporarily double the GST tax credit, top-up the Canada Housing Benefit by $500, and start the rollout of a dental care program.

Follow the money

As global markets go haywire, US stocks are suddenly looking pretty appealing in comparison (disclaimer: they’re still looking pretty bad).