After looking at this morning’s Canada dollar, one would not believe that there had been an election yesterday, no movement in the currency, no real headlines on news services outside Canada, just another day. That being said, one thing that has come out of this election, is that Canada is not only politically divided, but also geographically. the result has exposed a deep fault line between rural Canada and its biggest cities, as well as a stark regional split. The Conservatives, traditional champions of the oil sector, finished strongly in the western provinces, while the separatist Bloc Quebecois more than tripled its tally from 2015.
Canadian retail sales unexpected fell in August, posting the third decline in four months. Following an upward revised 0.6 percent rise in July, seasonally adjusted sales fell 0.1 percent on the month, much weaker than the consensus forecast calling for a 0.6 percent increase. Annual growth fell 0.1 percentage point to 1.1 percent. In volume terms, however, monthly sales rose 0.3 percent and the year-on-year rate rose 0.5 percentage points to 0.5 percent.
The autumn Business Outlook Survey indicates another slight improvement in sentiment after similarly modest (though downward revised) gains in the summer. Regional differences have become more pronounced, however, with positive views in Central Canada contrasting with widespread weakness in the Prairies. The overall business outlook indicator rose to 0.43 from a downward revised minus 0.07 in the previous quarter, continuing the rebound from the first quarter’s downward revised minus 1.05, the lowest level since the third quarter of 2016.