Evening Update: Canada’s inflation rate eased in December, but a BoC rate hike is still expected

Good evening, let’s start with today’s top stories:

Canada’s annual inflation rate at 6.3 per cent alongside a steep drop in gasoline prices

Canada’s inflation rate eased in December, largely as a result of a plunge in gasoline prices, in what is an encouraging sign for the Bank of Canada as it mulls further increases in interest rates.

The consumer price index rose 6.3 per cent in December from a year earlier, down from a 6.8-per-cent pace in the previous month, according to Statistics Canada.

Still, many analysts expect the the central bank to hike its policy rate by one-quarter of a percentage point to 4.5 per cent next week.

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China’s first population decline in decades points to looming demographic crisis

China has reported that its population, the largest in the world, shrank last year for the first time since a major famine during the Mao era.

While expected, this is a pivotal moment, pointing to a demographic crisis that will dominate the agenda of China’s leaders in coming years and could hamper future economic growth. It could even prevent the country overtaking the United States as the world’s largest economy.

China recorded 9.56 million babies born last year, an almost 10 per cent drop compared with 2021, and the sixth-straight annual decline. This was not enough to offset the 10.41 million deaths in 2022, leading to an overall population drop of about 850,000.

Ukrainian oligarchs struggle for influence as war effort forges ahead without them

The oligarchs’ efforts to show their pro-Ukrainian colours come as their collective influence is at a low ebb, Mark MacKinnon writes. Many of their businesses have been destroyed – or at least have had their bottom lines badly damaged – by the war.

They also lost much of their political influence when Ukrainian President Volodymyr Zelensky declared martial law and decreed that the country’s main television channels – long used by the tycoons to promote their agendas – now had to broadcast a single, “unified” newscast.

Most importantly, for the first time in Ukraine’s modern history, the country has a leader who doesn’t need the oligarchs.

Today’s developments: Ukraine came a step closer to winning the fleet of modern battle tanks it hopes could turn the course of the war against Russia, after Germany said this would be the first item on its new defence minister’s agenda.

Read more:

Canada’s new alcohol guidelines advise fewer drinks

Canada’s new guidelines on alcohol and health have been released, with the following advice: Any reduction in drinking helps. The more you drink, the higher the risks are. And preferably, consume no more than two drinks on a given day.

The guidelines, from the Canadian Centre on Substance Use and Addiction, present health risks associated with different amounts of alcohol, including those for several types of cancer, heart disease and stroke.

One to two standard drinks a week, each the equivalent of a 12-ounce serving of 5-per-cent-alcohol beer or a five-ounce glass of 12-per-cent-alcohol wine, is considered low-risk, and that risk increases with greater consumption.

ALSO IN THE NEWS TODAY

‘Plausible burials’ discovered near residential school: Wauzhushk Onigum Nation in Northern Ontario says it has uncovered 171 “plausible burials” in studies of cemetery grounds at a former residential school site.

Former OPSEU boss calls allegations ‘bogus’: Warren (Smokey) Thomas, ex-president of the Ontario Public Service Employees Union, has called the recent allegations of financial improprieties made against him by the union “bogus” and is vowing to defend them.

Layoffs at Lightspeed: Montreal payments-and-retail platform Lightspeed Commerce is cutting about 300 jobs in a reorganization, making it the latest major Canadian tech company to shed workers amid a prolonged downturn in the sector.

Madonna coming to Canada: Madonna has released dates for her 2023 Celebration tour through North America and Europe , kicking off July 15 in Vancouver. It includes stops in Toronto on Aug. 13 and Montreal on Aug. 19.

Arkells singer lends name to Hamilton snowplow: Max Kerman secured a landslide victory in the band’s hometown name-that-plow contest, resulting in one of 10 plows being dubbed the “Max Kermanator.” He said he was “delighted” by the “incredibly stupid” honour.

Arkells front man Max Kerman performs during the Juno Awards in London, Ont., on March 17, 2019.LARS HAGBERG/AFP/Getty Images

MARKET WATCH

Canada’s main stock exchange closed higher for the eighth day in a row, in a fairly broad advance across sectors following today’s inflation report. On Wall Street, the Dow fell sharply as weak earnings from Goldman Sachs dragged the index lower, but a jump in Tesla shares helped the Nasdaq stay little changed as the corporate earnings season took center stage.

The Dow Jones Industrial Average fell 391.76 points or 1.14 per cent to 33,910.86, the S&P 500 slid 8.12 points or 0.2 per cent to 3,990.97, and the Nasdaq Composite added 15.95 points or 0.14 per cent to end at 11,095.11.

The S&P/TSX Composite Index advanced 67.13 points or 0.33 per cent to 20,457.46. The loonie traded at 74.67 U.S. cents.

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TALKING POINTS

It’s due time that Canada called Russia what it is: a terrorist state

“So what does it take to be labelled a state sponsor of terrorism, a designation that typically comes with a raft of sanctions, economic and otherwise? Because if Russia doesn’t fit that definition, what government does?” - Gary Mason

New Bill Morneau book offers insider’s account of first five years of Trudeau government

“Morneau, like former attorney-general and justice minister Jody Wilson-Raybould, has written a book criticizing a Prime Minister still in office. Whatever his other qualities, Trudeau deeply antagonized some people who worked with him.” - John Ibbitson

LIVING BETTER

An estimated 1.4 million people in Canada are suffering the effects of long COVID. Newly published papers from a University of Toronto team aim to help clinicians diagnose, assess and treat the condition. The papers also feature guidance on some of the most common symptoms associated with the condition, such as fatigue, depression and anxiety, shortness of breath, sleep disturbance and heart palpitations.

TODAY’S LONG READ

Ottawa eyes ‘aggressive measures’ to clear immigration backlog, memo reveals

There were more than two million immigration applications to be processed by the IRCC as of late last year, including from those seeking work and study permits, along with those who applied for permanent residence.CARLOS OSORIO/Reuters

The federal government is considering extraordinary measures to reduce its backlog of immigration applications, including waiving eligibility requirements for nearly half a million visitor visas, according to a policy memo reviewed by The Globe and Mail.

A draft document from December reveals that Immigration, Refugees and Citizenship Canada is trying to significantly reduce or eliminate its inventory of visitor visa applications by February and is willing to use “aggressive measures” to do so. There were more than 700,000 temporary resident visa applications in the system as of early December, a portion of the overall sum.

In total, there were more than two million immigration applications to be processed as of late last year, including from those seeking work and study permits, along with those who applied for permanent residence. Read Matt Lundy’s full story.

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