Daily Pulse


Bank of Canada Governor Stephen Poloz said he expects global interest rates to remain low for years to come due to the effects of structural forces such as sluggish productivity and population growth. In his final speech of the year, Poloz stepped back from near-term issues to focus on long-term forces acting on the economy, and laid out some specific areas the Bank of Canada expects to work on in 2020. “On balance, it looks like the global economy is set for continued slow economic growth for mostly structural reasons” over a period of years, said Poloz, according to prepared remarks of speech in Toronto. He noted he’s not making any “near-term prediction” on Canadian policy, other than to say the economy is running close to capacity.


President Donald Trump is expected to formally present an interim deal with China as soon as Friday that will avoid further escalation of a trade war that for almost two years has hung over the world’s largest economies and thus almost any country or company doing business in them. Trump and his aides have promised that the partial deal the president first announced on Oct. 11 will be followed by others. That’s because while the initial accord may see China increase its agricultural purchases to as much as $50 billion annually and make commitments on currency and intellectual property enforcement, it includes nothing on more potent structural issues such as the vast web of subsidies that has fueled the global rise of many Chinese companies. While Trump has insisted that as many as two further phases will follow, many analysts are skeptical much more progress can be made going into an election year in the U.S. That could allow the Chinese to run out the clock.

Lawmakers from the House and Senate reached a bipartisan deal to fund the government before the Dec. 20 spending deadline, according to Nita Lowey, the New York Democrat who chairs the House Appropriations Committee. The $1.3 trillion deal in principle follows weeks of negotiations between the Democratic-led House, the Republican-led Senate and the Trump administration. Lowey was accompanied by her Republican and Senate counterparts when she told reporters on Thursday that they have an agreement on all 12 spending bills needed to fully fund the government for the rest of the fiscal year. The White House has yet to sign off on the agreement.


Boris Johnson won an emphatic election victory that redraws the political map of Britain and gives the prime minister the mandate he needs to pull the U.K. out of the European Union next month. The result spectacularly vindicated Johnson’s gamble on a snap election to break the deadlock in Parliament over Brexit, as his Conservatives were set for their biggest majority since 1987 under Margaret Thatcher. The pound rose by the most in almost three years as the scale of the Tory victory became clear. The outcome was a stark repudiation of the main opposition Labour Party under Jeremy Corbyn and his radical program of state intervention, nationalization of key industries and tax rises for the better off. Corbyn announced his intention to resign after a catastrophic run of losses to the Tories in Brexit-supporting districts in northern England and Wales. These areas were considered traditional Labour strongholds and Johnson’s success here was the breakthrough that secured his victory.

The Bank of Russia delivered a fifth consecutive bout of monetary easing and said it would consider more cuts in the first half of next year as inflation continues to fall below target. The bank lowered its benchmark interest rate by 25 basis points to 6.25%, according to a statement published on Friday, taking the total reduction this year to 150 basis points. The move was forecast by 26 out of 33 economists in a Bloomberg survey. Four had predicted a hold and three expected a deeper move.


Japan will spend an extra 4.5 trillion yen ($41 billion) this fiscal year to boost an economy that’s facing sputtering growth and a difficult recovery from recent natural disasters, according to documents released by the Finance Ministry Friday. The extra spending comes amid a rising awareness around the world that more government help is needed to keep economies growing in the face of a global slowdown that is exposing the limits of relying on central banks to do the heavy lifting of economic management. Japan’s economy has slowed all year and is forecast to shrink 2.6% this quarter as a sales tax hike weighs on consumer spending, which has been a key prop to growth amid slumping exports.

The author

Michel Doucet

Michel Doucet

Vice-President and Portfolio Manager
After obtaining a Bachelor's degree from the Faculty of Social Sciences at the Université du Québec in Montréal and his Master’s degree, Michel Doucet began his career as a junior economist at the National Bank head office in Montreal. In 1992 he joined the institutional equities and fixed income group at Lévesque Beaubien Geoffrion as an economist and market analyst. Over the years, he has led various projects related to the North American and international economies as well as Canadian public finances. In 1996, the team of institutional economists to which he belongs was ranked first in Canada by Brendan Wood International. In August 1997, Mr. Doucet joined the personal services division of Lévesque Beaubien Geoffrion where he served as an economist, fixed income market analyst and vice president. In 2004, he joined the Desjardins Securities full service team as Vice President. He now occupies the roles of fixed income strategist, economist and portfolio manager. He manages the Securities Portfolio Advisory Group, advisor marketing and distribution of financial planning and insurance.