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These are stories Report on Business is following Wednesday, Jan. 21, 2015.

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'And then there were two'
Sal Guatieri has looked at the latest stats, and decided that what were once three hot housing markets are now just two.

Like others, the senior economist at BMO Nesbitt Burns is now counting Calgary out amid the plunge in oil prices.

Which leaves just Toronto and Vancouver.

"After leading most cities in sales and price gains last year, Calgary's high-flying housing market has caught a serious chill," Mr. Guatieri said in a recent research note titled "And then there were two."

Home sales in Calgary tumbled 37 per cent in the first half of January, compared to a year earlier, while prices dipped 1.5 per cent and active listings surged by almost 65 per cent.

"More pain lies ahead, as pending sales plunged 53 per cent," Mr. Guatieri said.

"Meantime, Torontonians braved the cold temperatures to lift sales 9.8 per cent in the same [early January] period," he added.

"Vancouver doesn't report mid-month figures, but had strong momentum heading into the new year."

Indeed, the Bank of Canada warned just today of slower housing markets in Alberta.

"The oil-price shock will also affect housing activity in energy-intensive regions," the central bank said in its monetary policy report.

"There has been a decrease in housing starts and a sharp drop in resales and sales-to-listing ratios in December," it added.

"Near-term housing activity elsewhere is expected to remain high, supported by very low mortgage rates, although the extent to which the downturn already evident in Alberta will spill over into other regions remains to be seen."

Inflation fades
The outlook for consumer prices is fast looking like a New England Patriots football.

Not only is the Bank of Canada expected to trim its projections for inflation, two other major central banks had warnings of their own today.

According to minutes of its last meeting, the Bank of England now believes inflation could fall below zero.

"CPI inflation had fallen to 0.5 per cent in December, 0.5 percentage points lower than had been expected in November, and was now expected by bank staff to reach a trough of close to zero in March, as lower oil prices fed through to petrol prices," according to the central bank minutes.

"There was, therefore, a roughly even chance that CPI inflation would temporarily dip below zero at some time during the first half of 2015. Inflation had also fallen abroad and was negative in the euro area."

The Bank of Japan, meanwhile, which is no stranger to deflation, also trimmed its inflation forecasts.

"With regard to the CPI, the outlook for the underlying trend remains unchanged, but the year-on-year rate of increase will likely be lower toward fiscal 2015, due to the significant decline in crude prices," it said.

Markets mixed
Global markets are mixed so far this morning as Europe's big day draws ever closer.

"It is just over 24 hours to go until we hear from ECB president Mario Draghi, and last-minute jitters are hampering the confidence of equity markets," said market analyst Alastair McCaig of IG, referring to what's expected to be the unveiling of a quantitative easing program from the European Central Bank tomorrow.

"With a number of indices having hit multi-year highs over the course of the week this may be a case of buy the rumour and sell the news."

Keep an eye on Netflix Inc., whose shares are surging.

Keep an eye, too, on Microsoft Corp. stock as the company is poised today to unveil more details of Windows 10, its next version.

"Windows 8 is widely viewed as a complete failure and that goes some way to explain a very fast turnaround of a new operating system that even appears to have skipped a numeral (9?)," said CMC's Mr. Lawler.

"Microsoft needs a better execution of what is probably the right idea of creating an operating system that can be used on both PCs and mobile; failure to do so could see further erosion of their dominant position in the PC market to Apple and Google, and shares could suffer as a result."

Fast stands firm
Canada's top trade official is holding the line on the country's 'Buy America' spat with the United States.

In Rome today, Trade Minister Ed Fast warned that the rebuilding of a B.C. ferry terminal is doomed unless Alaska backs down.
"We have made it very clear that the Buy America provisions will not be applied on Canadian soil, property owned by the federal government," Mr. Fast said.

As our European bureau chief Eric Reguly reports from Rome, Mr. Fast was referring to the ferry terminal that sits on Crown land in Prince Rupert, in northern B.C. near the Alaska panhandle.

Because the terminal is leased to the Alaska Marine Highway System until 2063, and the project is being funded by the U.S. and Alaskan governments, Alaska Governor Bill Walker is insisting that the Buy America rule applies to the steel used in the construction.

Canada is fighting that with special measures.

Toyota sees decline
Toyota Motor Corp. is projecting a drop in production and sales this year.

According to its forecasts for 2015 released today, the Japanese auto maker expects global production to be cut by 1 percent, to about 10.2 million vehicles.

The cut will come in Japan, to the tune of a 6-per-cent decline, while production in other countries rises 3 per cent.

Toyota also forecasts a 1-per-cent decline in sales, but again, that's because of Japan, where they're expected to fall by 9 per cent to 2.1 million.

Outside of Japan, sales are projected to rise 2 per cent, for global sales just shy of 10.2 million.

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