Canada’s 2017 economic outlook_ a tale of two _tails_ _ pimco

.

At the risk of entering the realm of cliché, we couldn’t help but draw parallels with Dickens’ classic novel, “A Tale of Two Cities,” when forecasting the Canadian economy in 2017. Dollar vs euro chart As he wrote, “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity.”

The key theme of income inequality running through the heart of the novel rings as true now as it did a century-and-a-half ago, manifesting itself globally in 2016 with the U.K.’s Brexit vote, Italy’s constitutional referendum and the election of Donald Trump as president of the U.S. Current exchange rate usd to cad And we face the spectre of more political volatility in 2017 with the upcoming elections in France and Germany.

It is within this global environment that Canada’s small and open economy must navigate, and we believe 2017 will be a tale of two “tails.” More specifically, we believe the tails of the distribution of economic outcomes have become fatter – that is, the probability of more extreme outcomes (both good and bad) is higher than in a normal distribution (see Figure 1).

There is nothing particularly earth-shaking about our baseline forecasts of 1.5%-2.0% real GDP growth and core inflation of 1.5%-2.0% for Canada, or our view that the Bank of Canada will hold the overnight rate at 0.5%. Usd today What is worth noting is that with fatter tails comes less certainty about our baseline view. Ringgit usd exchange rate And we believe active investors’ success in adding value in 2017 will hinge on how well they navigate the potential risks and opportunities we see for Canada. Stock market meanings Left-tail risks: “The worst of times”

During his campaign, Donald Trump railed against “terrible” U.S. Kurs usd ke rupiah trade agreements and promised to renegotiate NAFTA. Exchange rate us to canadian dollar But will he follow through with this campaign promise? There are congressional proposals to impose a destination tax on goods crossing the U.S. Samsung washing machine codes border that could be devastating to Canadian exports. Convert indonesian rupiah to usd Renegotiating NAFTA will be a lengthy and complicated process; it is unclear whether it can be successfully completed. Binary tools We may see the Trump administration looking for immediate results by targeting specific companies and industries within the World Trade Organization framework.

Mexico and China have been the main targets of Trump’s trade concerns, while Canada has been relatively under the radar (except for the revival of the Keystone XL pipeline, which former President Barack Obama had rejected in 2015). Futures market cnn Canadian Prime Minister Justin Trudeau has elevated a former PIMCO Secular Forum speaker, Chrystia Freeland, to foreign minister with the explicit task of ensuring that Canada does not become collateral damage in new trade deals.


Msn news usa We will continue to monitor this fluid situation, which remains a major left-tail risk to our baseline forecast.

Canadian consumers could face a very difficult 2017, with the potential for higher interest rates when net debt-to-income ratios are at an all-time high of 167%. Nzd usd live chart Most housing markets in Canada have never been more expensive, and governments are implementing policies to reduce (or reverse) house price inflation. Dollar exchange rate in india Vancouver has put a 15% tax on foreigners buying homes, and the Canada Mortgage and Housing Corporation (CMHC) and Office of the Superintendent of Financial Institutions (OSFI) are implementing policies to slow mortgage credit growth. Usatoday com news While our base case is that housing price inflation will slow in 2017, there is a risk that prices could contract. Trading places stock market scene Higher interest rates and lower house prices could detract from GDP growth by lowering consumption and residential investment.

Oil prices have been highly volatile of late, with Canada’s Western Canadian Select trading as low as $13.80 per barrel before closing the year at $37.60. Convert aud to usd This oil price shock damaged the Canadian economy and was a main reason the Bank of Canada cut the overnight rate to 0.5% from 1% in 2016. Inc connector Looking ahead, we think OPEC’s decision in November to cut oil production has probably truncated the downside risk to oil prices for 2017. Usd news This means the energy sector will likely be a contributor to GDP growth this year (given the low base effects). Binary dictionary That said, if oil prices were to move substantially lower, Canadian GDP growth would likely suffer. Us stock market futures contract Right-tail opportunities: “The best of times”

Canadian policymakers have been holding their breath waiting for robust exports to propel the country’s economic expansion. Funny quotes about life lessons The Bank of Canada recently released its Winter 2016-17 Business Outlook Survey, which, compared with the previous quarter, showed that more Canadian firms expected the November election to lead to strong U.S. Exchange rate mxn usd economic growth.

While considerable uncertainty remains about U.S. Dollar yen exchange rate fiscal policy, with Republicans controlling both houses of Congress and the presidency, we expect a positive fiscal impulse over the next couple of years. Market futures quotes Moreover, financial and energy markets have interpreted Trump’s preference for less regulation positively. Binary to hex We see a clear possibility that a pro-growth agenda from Washington could lead to increased consumer and business confidence and in turn spur more investment and consumption. Fraction to whole number calculator Historically, a strong U.S. Kroner to usd economy has translated into strong Canadian exports – and this could be a meaningful positive upside to our baseline forecast for 2017.

One of the hallmarks of the global economic recovery since the financial crisis has been the absence of robust growth in business fixed investment. Love quotes tagalog Faced with high degrees of uncertainty about everything from government policy to Asia and Europe, businesses’ fixed investment has lagged levels seen in past cycles. Euronews online russian If a pro-growth U.S. Usd myr chart agenda leads to a rise in what John Maynard Keynes called “animal spirits,” then we could see investment-led growth in both the U.S. Usd cad analysis and Canada. Troy isd A virtuous cycle of export growth and investment could in turn enable Canada to outperform PIMCO’s 2017 real GDP forecast of 1.5%-2%. Convert binary to decimal Investment implications

We forecast that both the U.S. Crossword puzzle usa today Federal Reserve and the Bank of Canada will continue to pursue accommodative monetary policies. The millionaire real estate agent pdf While the Fed may raise the fed funds rate multiple times in 2017, it will likely be cautious to avoid making a “hawkish mistake.” As U.S. Gender identity disorder test rates rise, we would expect Canadian rates to rise and for the yield curve to steepen. Chf usd chart However, the Bank of Canada’s more accommodative stance would likely translate to a slower pace of increases than in the U.S.

Such accommodative monetary policies should continue to support the credit cycle and credit spreads. Usps shipping cost We think a number of geopolitical, economic and policy events will contribute to continued volatility in the markets. Usd gbp exchange rate This could lead to bouts of spread widening in the credit markets, and we would look to buy high quality income-generating bonds during those periods.Finally, as the U.S. Us dollar rate today in india economy recovers and Fed policy normalizes, we expect the U.S. Usa today newspaper dollar to strengthen against a basket of currencies (including the Canadian dollar).

Pacific Investment Management Company LLC, 650 Newport Center Drive, Newport Beach, CA 92660 is regulated by the United States Securities and Exchange Commission. Stock futures cnn money | PIMCO Europe Ltd (Company No. Gbp to usd 2604517), PIMCO Europe, Ltd Amsterdam Branch (Company No. World stock markets cnnmoney 24319743), and PIMCO Europe Ltd- Italy (Company No. 1 usd to zmk 07533910969) are authorised and regulated by the Financial Conduct Authority (25 The North Colonnade, Canary Wharf, London E14 5HS) in the UK. Gbp usd exchange rate live The Amsterdam and Italy Branches are additionally regulated by the AFM and CONSOB in accordance with Article 27 of the Italian Consolidated Financial Act, respectively. Math smartboard games PIMCO Europe Ltd services and products are available only to professional clients as defined in the Financial Conduct Authority’s Handbook and are not available to individual investors, who should not rely on this communication. Futures market hours today | PIMCO Deutschland GmbH(Company No. Usa today sports odds 192083, Seidlstr. 1 usd to chf 24-24a, 80335 Munich, Germany) is authorised and regulated by the German Federal Financial Supervisory Authority (BaFin) (Marie- Curie-Str. Fraction worksheets 3rd grade 24-28, 60439 Frankfurt am Main) in Germany in accordance with Section 32 of the German Banking Act (KWG). Yahoo futures The services and products provided by PIMCO Deutschland GmbH are available only to professional clients as defined in Section 31a para. Grain futures markets 2 German Securities Trading Act (WpHG). Call option in the money They are not available to individual investors, who should not rely on this communication. Decimal operations worksheet | PIMCO (Schweiz) GmbH (registered in Switzerland, Company No. Dollar to pound conversion rate CH-020.4.038.582-2), Brandschenkestrasse 41, 8002 Zurich, Switzerland, Tel: + 41 44 512 49 10. Usd rmb exchange rate The services and products provided by PIMCO Switzerland GmbH are not available to individual investors, who should not rely on this communication but contact their financial adviser. Verizon modem password | PIMCO Asia Pte Ltd (501 Orchard Road #09-03, Wheelock Place, Singapore 238880, Registration No. Gender roles in society articles 199804652K) is regulated by the Monetary Authority of Singapore as a holder of a capital markets services licence and an exempt financial adviser. Exchange rate rupee to usd The asset management services and investment products are not available to persons where provision of such services and products is unauthorised. Binary code decoder | PIMCO Asia Limited (Suite 2201, 22nd Floor, Two International Finance Centre, No. Stock market futures implied open 8 Finance Street, Central, Hong Kong) is licensed by the Securities and Futures Commission for Types 1, 4 and 9 regulated activities under the Securities and Futures Ordinance. The box movie The asset management services and investment products are not available to persons where provision of such services and products is unauthorised. Nok usd | PIMCO Australia Pty Ltd ABN 54 084 280 508, AFSL 246862 (PIMCO Australia) offers products and services to both wholesale and retail clients as defined in the Corporations Act 2001 (limited to general financial product advice in the case of retail clients). Vnd to usd converter This communication is provided for general information only without taking into account the objectives, financial situation or needs of any particular investors. Binary code translation | PIMCO Japan Ltd (Toranomon Towers Office 18F, 4-1-28, Toranomon, Minato-ku, Tokyo, Japan 105-0001) Financial Instruments Business Registration Number is Director of Kanto Local Finance Bureau (Financial Instruments Firm) No.382. 1 usd to rmb PIMCO Japan Ltd is a member of Japan Investment Advisers Association and The Investment Trusts Association, Japan. Usps shipping supplies Investment management products and services offered by PIMCO Japan Ltd are offered only to persons within its respective jurisdiction, and are not available to persons where provision of such products or services is unauthorized. Exchange rate usd to rmb Valuations of assets will fluctuate based upon prices of securities and values of derivative transactions in the portfolio, market conditions, interest rates, and credit risk, among others. Exchange rate us to canada Investments in foreign currency denominated assets will be affected by foreign exchange rates. What is a binary number There is no guarantee that the principal amount of the investment will be preserved, or that a certain return will be realized; the investment could suffer a loss. Convert idr to usd All profits and losses incur to the investor. Commodity futures price quotes The amounts, maximum amounts and calculation methodologies of each type of fee and expense and their total amounts will vary depending on the investment strategy, the status of investment performance, period of management and outstanding balance of assets and thus such fees and expenses cannot be set forth herein. Usd to nzd | PIMCO Canada Corp. Euro dollar exchange rate chart (199 Bay Street, Suite 2050, Commerce Court Station, P.O. Us futures market live Box 363, Toronto, ON, M5L 1G2) services and products may only be available in certain provinces or territories of Canada and only through dealers authorized for that purpose. Usd aud exchange rate | PIMCO Latin America Edifício Internacional Rio Praia do Flamengo, 154 1° andar, Rio de Janeiro – RJ Brasil 22210-906.

Past performance is not a guarantee or a reliable indicator of future results. 1 usd to malaysian ringgit Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk. Futures markets explained The value of most bonds and bond strategies are impacted by changes in interest rates. Usd to aud converter Bonds and bond strategies with longer durations tend to be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and the current low interest rate environment increases this risk. Usd to ringgit Current reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Best used bookstores nyc Bond investments may be worth more or less than the original cost when redeemed. Python xml Investing in foreign-denominated and/or -domiciled securities may involve heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets. Binary file download Currency rates may fluctuate significantly over short periods of time and may reduce the returns of a portfolio.

Forecasts, estimates and certain information contained herein are based upon proprietary research and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Cad to usd converter There is no guarantee that results will be achieved.

Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. Hex to binary converter There is no guarantee that these investment strategies will work under all market conditions or are suitable for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Binary code reader Outlook and strategies are subject to change without notice.

This material contains the opinions of the author but not necessarily those of PIMCO and such opinions are subject to change without notice. Famous quotes about friendship This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Picture format converter Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. Gbp to usd exchange rate history No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. Binary editor PIMCO is a trademark of Allianz Asset Management of America L.P. Usd to inr history in the United States and throughout the world. Gold chart 1 year ©2017, PIMCO.

(ii) confirm and agree to be bound by the statement that the jurisdiction you have selected is the applicable jurisdiction for the intended investment activities;

(iii) confirm that you are accessing this Website in compliance with the laws and regulations of the jurisdiction or country you have selected, and all other applicable laws, rules and regulations; and

or access) this Website on behalf of your employer, your client, or both, and that in doing so you are acting within the scope of your duties and, at all times, on behalf of your employer, your client or both.

(ii) confirm and agree to be bound by the statement that the jurisdiction you have selected is the applicable jurisdiction for the intended investment activities;

(iii) confirm that you are accessing this Website in compliance with the laws and regulations of the jurisdiction or country you have selected, and all other applicable laws, rules and regulations; and

or access) this Website on behalf of your employer, your client, or both, and that in doing so you are acting within the scope of your duties and, at all times, on behalf of your employer, your client or both.


banner