Weekly Economic Update

For the week of May 15 – 19.

Canadian data releases for the week include manufacturing sales, international securities transactions, consumer prices, and retail sales. March retail sales figures are expected to have grown by 0.3 percent after falling by twice that amount in February. Excluding autos, sales grew by 0.2 percent. Consumer prices for April are expected to have grown by 0.6 percent on a month-over-month basis and 1.8 percent on a year-over-year basis. Releases out of the United States this week include empire manufacturing, housing starts, and industrial production.

Although United States reported growth in consumer prices and retail sales last Friday, equities and bond yields were down for the majority of the day. Despite both measures showing positive growth on a month-over-month basis, retails sales fell short of expectations. Consumer prices did the same after exclusion of the more volatile food and energy prices.

Oil prices are surging this morning on statements by Russia and Saudi Arabia, indicating an additional 9 month extension of production cuts. This extension is greater than investors were anticipating. Oil ministers for the two countries believe this extension is necessary to bring the market back into a desirable state. Further remarks suggest that other OPEC members are in agreement with the extension. Prices are currently up by 3.09 percent to $49.32 per barrel.

As one would expect, the Canadian dollar is sharing in oil strength, and is currently up approximately 0.7 percent against the US dollar. Today’s expected range is 1.3565 – 1.3665.

Source: Bloomberg

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