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Daily Pulse

Canada

After a decade of middling wage growth, Canadian workers are finally starting to see significantly bigger paychecks. The question is whether those gains are sustainable. Wages have risen upwards of 4% annually in recent months by some measures, the fastest pace since 2009. This would typically be a strong signal of health in the nation’s economy and foster confidence in future growth. But another indicator is prompting economists to worry the wage gains may soon reverse course. Productivity figures have barely budged and remain little changed from two years ago. Those two measures of the economy can only diverge for so long before companies either curtail output or raise prices to pay for the higher wages.

United-States

Donald Trump’s legacy will be forever marked on Wednesday by his impeachment at the hands of House Democrats, who say it’s a necessary rebuke for the president’s pursuit of a political vendetta. On the eve of the vote, Trump defiantly rejected the move as a predetermined partisan assault. Trump is all but certain to become the third U.S. president in history to be impeached when lawmakers gather Wednesday in the well of the House, as their predecessors did when they voted to impeach Andrew Johnson and Bill Clinton.

Fresh off a pair of wins with China and USMCA, President Donald Trump’s top trade official is shifting his focus toward to the biggest target of them all: the European Union. “We have a very unbalanced relationship with Europe,” U.S. Trade Representative Robert Lighthizer said Tuesday in another victory-lap interview, this one on Fox Business Network. “There are a lot of barriers to trade there and there are a lot of other problems that we have to address.”

Europe

The European Central Bank’s Single Supervisory Mechanism will likely lift the ceiling on Greek banks’ holdings of the country’s sovereign bonds, people familiar with the situation said. The supervisory ceiling set in 2015 is expected to be lifted in February, according to the people, who asked not to be named discussing ongoing deliberations.

The European Parliament could block Boris Johnson's Brexit deal over the UK's treatment of EU citizens, its Brexit coordinator has said. Guy Verhofstadt called for the "remaining problems" with citizens' rights to be solved before consent could be given. MEPs are worried that problems with the UK's settlement scheme for EU nationals could cause problems, leave some citizens with no immigration status, and that the cost is too great. "Everyone presumes the European Parliament will give automatically its consent to the Withdrawal Agreement. Not if the remaining problems with the citizens' rights are not solved first," Mr Verhofstadt said. "Citizens can never become the victims of Brexit."

Asia

If history is anything to go by, an upgrade of the Bank of Japan‘s growth projection for next year is likely in January after the government nudged up its own economic outlook. Japan’s government now sees the economy expanding 1.4% in the year starting in April, compared with a projection in July of 1.2%, according to its latest forecasts released Wednesday. The government cited the stimulus package unveiled by Prime Minister Shinzo Abe earlier this month as a key factor for the faster growth.

India’s benchmark stock gauge closed at a record high for a second straight day as investors continued a spree that’s seen more net buying by foreign funds this year than since 2014. The S&P BSE Sensex Index climbed 0.5% to 41,558.57 as of the 3:30 p.m. close in Mumbai, matching the percentage advance of the NSE Nifty 50 Index. Globally, stocks are trading close to all-time highs, with the S&P 500 Index capping a fresh record Tuesday. Foreign investors have pumped $13.4 billion into India’s stocks this year, driving most of the Sensex’s 15% gain in 2019. Indian asset managers’ shares are trouncing global peers as they benefit from a shift in savings from gold and real estate to stocks and bonds, even as the economy grows at its slowest pace in more than six years.

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.