The Wrap Up – Rates to Increase

 

An inevitable pull back in equity markets hit all major indices in North America last week and gold and oil dropped as well. In the US, discussion regarding the Federal Reserve’s intention to raise interest rates has continued to grow and as a result stock prices fell. The Fed is concerned that the US economy will continue to grow when President Trump’s infrastructure rebuilding program takes effect and also since the 235,000 jobs created in the US in January beat forecasts. It is believed that continued demand for materials and job creation will create inflation, which the Fed will aim to prevent with interest rate hikes. 

In Canada, interest rate changes are much less certain than in the US, with Stephen Poloz, Governor of the Bank of Canada, not willing to indicate his intentions. In positive news, the Canadian economy continued its recent trade surplus and added over 15,000 jobs which lowered its unemployment rate in January.

This week in the US, all eyes will be on the Federal Reserve which has a monetary policy announcement; the expectation that interest rates will rise is nearly universal. This week in Canada, real estate sales and manufacturing data will be released but it will likely be overshadowed by news of the expected interest rate increase in the US. 

An interesting point of interest for those effected by daylight savings time – the Monday following the change is among the most dangerous days to be on the road as we all suffer from the effects of jet lag, so be careful.

Kevin

 

 

 

 

 

 

 

Disclaimer – This information transmitted is intended to provide general guidance on matters of interest for the personal use of the reader who accepts full responsibility for its use, and is not to be considered a definitive analysis of the law and factual situation of any particular individual or entity. As such, it should not be used as a substitute for consultation with a professional accounting, tax, legal or other professional advisor. Laws and regulations are continually changing and their application and impact can vary widely based on the specific facts involved and will vary based on the particular situation of an individual or entity. Prior to making any decision or taking any action, you should consult with a professional advisor. The information is provided with the understanding that Harbourfront Wealth Management is not herein engaged in rendering legal, accounting, tax or other professional advice. While we have made every attempt to ensure the information contained in this document is reliable, Harbourfront Wealth Management is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information is provided “as is,” with no guarantee of completeness, accuracy, timeliness or as to the outcome to be obtained from the use of this information, and is without warranty of any kind, express or implied. The particulars contained herein were obtained from sources we believe to be reliable, but are not guaranteed by us and may be incomplete. Harbourfront Wealth Management Inc. is a member of the Investment Industry Regulatory Organization of Canada “IIROC” and the Canadian Investor Protection Fund “CIPF”.