Weekly Digests

Welcome to our Weekly Digest – stay in the know with some recent news updates relevant to business and the economy.

Canadians should be prepared for a possible recession because there’s a chance it could happen.

Former Bank of Canada governor Stephen Poloz has noticed signs of recession in parts of the Canadian economy, as growth struggles to keep pace with the country’s rapidly increasing population. While the economy is expanding, it’s not growing fast enough to meet the needs of a larger population, creating recession-like conditions in certain sectors.

Poloz warns that if growth doesn’t improve, Canada could face bigger economic challenges and declining living standards. However, he remains cautiously optimistic, believing that with the right policies, the country can boost growth and avoid the worst effects of these pressures.

Business leaders say the upcoming Air Canada strike is like playing ‘Russian roulette’ with the economy.

The president of the Business Council of Canada called on the federal government to intervene and prevent a potential Air Canada strike, warning that it would disrupt key industries reliant on the airline for transportation and logistics. He emphasized that a work stoppage could lead to delays and financial losses for businesses across the country.

He also cautioned that such a strike would damage Canada’s international reputation, making it seem less reliable as a trading partner. The president urged swift government action to avoid these negative impacts and keep Air Canada operational for the sake of the economy and Canada’s global standing.

Canada’s slowdown in productivity affects everyone.

Canada’s economic performance has significantly declined since the pandemic, a trend that should concern all Canadians, particularly younger generations. In 2023, the standard of living, measured by real GDP per person, was lower than in 2014, highlighting the country’s struggle to improve living conditions over the past decade.

If productivity growth doesn’t improve, Canadian workers may face stagnating wages, impacting their quality of life. Additionally, the government could face revenue shortfalls, leading to higher taxes or cuts in public services, increasing financial pressure on the population.

Consumer confidence is getting better, even with worries about the economy.

Empire CEO Michael Medline has observed early signs of improving consumer sentiment, with shoppers feeling more positive despite ongoing challenges in the Canadian economy. This shift is resulting in more stable and predictable shopping habits, as customers return to their usual buying patterns.

Medline views this as an encouraging sign for the grocery industry, indicating that consumers are gaining confidence in their spending. Although economic struggles persist, the early signs of recovery in consumer sentiment are a positive development for both retailers and shoppers.

Gas prices in Canada have fallen to their lowest level since February.

Gas prices in Canada have dropped to their lowest national average since February, offering relief to Canadians who have been facing high fuel costs for much of the year. This decline is expected to ease financial pressure on consumers, benefiting both urban and rural areas.

While the lower gas prices are likely to positively impact household budgets and transportation costs, it remains uncertain how long this trend will continue, providing short-term financial relief for now.

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