canadian home sales slow in august
- Data for Canadian home sales showed national activity fell 3.1% in August.
- Vancouver, currently Canada’s most expensive market, experienced a slide of 19% from the prior month in response to a new 15% property transfer tax that went into effect August 2nd.
- Toronto, meanwhile, has become the new hotspot with an increase in sales of 22.7% year over year. Surging activity has continued to spill into the Greater Toronto Area markets, as well.
- Vancouver’s luxury transactions, as defined by a deal worth $1 million or more, fell 65% year over year.
china shows potential signs of stabilizing
- Advances across the board for China’s “data dump” came as welcome news after July weakness. Industrial production rose by 6.5% year over year, retail sales by 10.6% year over year and fixed asset investment remained a steady 8.1% year to date.
- A closer look at fixed asset investment, however, showed growth moving at its slowest pace in 16 years. Even worse, private sector investment grew by 2.1% in comparison to state-backed 21.4%.
- While Chinese data is often scrutinized for credibility and accuracy, these results do align with August’s manufacturing PMI of 50.4.
Brexit uncertainty doesn’t stem spending in u.k.
- Upwardly revised July retail sales and better-than-forecasted August data suggest consumers aren’t willing to curb spending, despite uncertainty within the region.
- On an annual basis, sales volumes were 6.2% higher in August compared to 2015.
- Overall, the state of the U.K. appears to be in better shape than many expected given the surprise election result at the end of June. That said, much remains to be seen around Prime Minister Theresa May’s plan on exiting the European Union over the coming months.
OTHER ECONOMIC NEWS
- U.K. and eurozone CPI results released were in-line with expectations. The eurozone posted a gain of 0.2% in August and has not moved higher than 0.3% this year. In the U.K., inflation remained at 0.3% for the month. This was slightly lower than expected given the amount the pound has depreciated post-Brexit.
- The Bank of England kept rates unchanged at 0.25%, but suggested a further cut later this year is possible. The policy rate is already at the lowest in the Bank’s 322 year history. The bond buying program was kept unchanged at £435B as well, although two committee members dissented.
- U.S. retail sales continued a string of disappointing results in August. Weak auto purchases caused the first decline since March, pointing to cooling domestic demand. Retail sales declined 0.3% month over month and were up 1.9% compared to a year ago.
- Canadian manufacturing data showed modest signs of recovery after the Alberta wildfires. Results ticked up by 0.1% in July with strong improvement in petroleum and coal products. Still, there’s ground to be made up with volumes down 2% in comparison to January levels.
Sources: Bloomberg, Investment Executive, The Guardian, BMO Capital Markets, Globe and Mail