We spent almost all of 2022 talking about high costs and rising Interest Rates. Canada's Inflation Rate got as high as 8.1% so that was no easy year to get through. It impacted Bond Prices dramatically and we spent most of last year waiting for a recession that never came. 2023 has been a much better year for Financial Markets. The rate of Inflation has cooled off significantly and came in at 3.4% by May of this year1. That's still higher than the 2.0% that we've been used to for a few decades but it's moving in the right direction. The rate was at 8.1% in June of 2022 so we have seen significant expectations. This rate of Inflation is also lower than a lot of expectations. On top of that, the Canadian Economy has been expanding at a higher rate than expectations. The economy is now on track to expand at a 1.4% annualized rate as of Q2. That's significantly faster than the 0.8% that a recent Bloomberg survey of economists anticipated. It's also higher that the Bank of Canada's own forecast of 1%2. We've been dealing with negative outlooks for our country for a long time now, but the data is showing a lot of optimism.
By the time you read this, I will have made my way out to see some clients in BC. Between the pandemic and recent forest fires, this had been tough to do for a few years. I'm hoping to make a trip West every summer I can. We also try to do one or two to the East to see clients in Saskatchewan. We've been connecting with clients in person since the beginning of 2022 and it's been great to see so many of you! Other than a Staycation between August 4th to the 13th, we'll be working throughout the summer. We do have a wedding in Ontario this Fall as well as our Portfolio Strategies Annual Conference in Kelowna. I know that a lot of you will be busy with your own Summer Plans but let us know if there's anything we can do for you!
Enjoy the sunshine and keep in touch,
Bryce Borden
2BNN Bloomberg: - https://www.bnnbloomberg.ca/canada-s-economy-strengthens-leaving-july-rate-hike-on-table-1.1939974