Weekly Economic Update

For the week of October 14 to 17

It is quiet throughout Canada this morning following the Thanksgiving long weekend with only one economic release on the schedule. The Bloomberg Nanos Confidence Index will update for the week ending October 10, 2014. The Confidence Index most recently measured in at 59.6 and has been hovering between 58.0 and 60.0 since March of this year. South of the border, NFIB Small Business Optimism has released at 95.3 for September, slightly below forecasts of 95.8. The uncertainty around future economic growth has caused optimism to fall from 96.1 in the previous update.

The Focus throughout Canada this week falls on the update to the Consumer Price Index, scheduled to release on Friday, October 17. The CPI is forecast to increase by 0.1% for September following no change in the previous month. On a year-over-year basis, the CPI is expected to show an increase of 2.0%. There is also an update to Manufacturing Sales on the schedule with economic forecasts calling for a drop of 2.0% for August, following a gain of 2.5% in the latest release.

In the United States this week, headlines include updates to Retail Sales, the Producer Price Index, Housing Starts, and Building Permits. Retail Sales are expected to show a drop of 0.2% on a month-over-month basis for September after a gain of 0.6% in the previous month. The PPI is forecast to rise slightly by 0.1% for September while Housing Starts and Building Permits are also expected to show increases throughout September.

In the currency markets, the Canadian dollar has fallen against its U.S. counterpart in early trading this morning as the price of oil continues to fall. Investor fears over a slowing global growth are starting to weight on the CAD which is once again trading near its YTD low of 1.1279 from March. Without much domestic data today, the CAD will be left vulnerable to broader market activity. Focus falls on the CPI data scheduled for later this week, with the next Bank of Canada announcement scheduled for October 22, 2014.

Todays expected range: 1.1183 – 1.1283

Source: Bloomberg

Posted by Concentra Financial Markets

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