These are stories Report on Business is following Tuesday, Jan. 21, 2014.
The Canadian dollar sank below 91 cents U.S. today before picking up again, setting the stage for what will be a widely-watched policy announcement from the Bank of Canada tomorrow morning.
The loonie, as Canada's dollar coin is known, has been eroding for the past year, driven lower most recently by an easy-going central bank and soft economic readings.
Playing into today's action is a rally in the U.S. dollar, helped along by a Wall Street Journal article that suggests the Federal Reserve is poised to unveil a further pullback in its bond-buying stimulus program, known as quantitative easing or QE.
It has already announced a so-called tapering to bring its monthly purchases down to $75-billion (U.S.) from $85-billion, and the latest article suggests a further $10-billion cut.
The Canadian dollar was trading back above 91 cents at midday, having slipped to 90.76 cents earlier, the lowest since the fall of 2009.
The focus now shifts to the Canadian central bank, and just how "dovish" governor Stephen Poloz and his colleagues will be tomorrow in their policy statement and accompanying monetary policy report, or MPR.
"Everyone's paying attention," said chief currency strategist Camilla Sutton of Bank of Nova Scotia.
The loonie could go either way tomorrow, though the betting is that Mr. Poloz and his policy-setting group will do their darnedest to keep the currency low, given that a low dollar helps the country's beleaguered exporters.
"The bank's biggest concern is persistently low inflation, and we expect that will be stressed even more firmly in the statement and the MPR inflation forecast will be downgraded," said senior economist Benjamin Reitzes of BMO Nesbitt Burns.
"That dovish tone on inflation is also important from a currency perspective," he added.
"Governor Poloz can't be anything but pleased with the loonie's recent weakness. So, the statement will try to be as dovish as possible, stopping short of signalling potential [interest rate] cuts, in order to ensure the C$ doesn't retrace some of its recent decline."
- Winning and losing stocks for a low-loonie era
- Barrie McKenna and Tavia Grant: Why a lower loonie is (mostly) good for Canada
- The flip side of the Canadian dollar: Frail loonie 'makes us all a bit poorer'
- The sick Canadian dollar: Who wins (exporters, hockey players) and who wins big
IMF boosts outlook
The International Monetary Fund says the global economy has turned a corner, propelled by faster-than-expected growth in the United States and Europe.
Global economic output will increase by 3.7 per cent this year, the IMF said today in a revised outlook, The Globe and Mail's Kevin Carmichael reports. The estimate is a slight revision from the 3.6 per cent increase the fund predicted in the fall. Its forecast for 2015 is unchanged at 3.9 per cent.
While the increase is slight, it represents a break from 2013, which was marked by disappointments. If the revised forecast holds, the global economy will grow the most this year since 2011, when the world's gross domestic product expanded almost 4 per cent.
Canada's economy will expand 2.2 per cent in 2014 and 2.4 per cent in 2015, the IMF said.
Shares of Agrium Inc. slipped today after a new earnings forecast from the Canadian agribusiness giant.
Potash Corp. of Saskatchewan stock also dipped.
Agrium said late yesterday it now projects fourth-quarter profit from continuing operations will come in "at the bottom" of its previous projection of 80 cents U.S. to $1.25 a share.
Agrium also said it expects record results from its retail arm, while citing several one-time adjustments.
"We continue to prefer the shares of Agrium on a relative basis to the potash equities," said CanaccordGenuity analyst Keith Carpenter.
"We feel that the stability of Agrium's base retail segment and an improving nitrogen sector bodes well for the company going forward. Add Agrium's organic growth profile across both retail and wholesale over the next few years, and we see the company as offering good value to shareholders."
Shares of Verizon Communications Inc. dipped today, though the U.S. telecommunications giant posted a fourth-quarter jump in revenue and gained more subscribers.
Verizon rebounded to a profit of $5.1-billion (U.S.) or $1.76 a share from a loss of $4.2-billion or $1.48 a share a year earlier.
"Verizon delivered a total return of 18.6 per cent to our shareholders in 2013, while attracting more customers than our competitors and improving our financial performance," said chief executive officer Lowell McAdam.
What's missing from the British army?
It's not just the silverware that has gone missing from Britain's armed forces, but thousands in Viagra, as well.
According to The Times and other news organizations Tuesday, the Ministry of Defence reports the theft of more than £7-million over the past seven years.
Among them are things you'd expect, such as bayonets, ammunition, copper pipes and £7,000 in cutlery from the Redford Cavalry and Infantry barracks.
Also stolen was a washing machine and about £6,000 in Viagra, the equivalent of almost $11,000.
The thefts were documented in a report, though, according to the news outlets, the ministry also cited the fact that Viagra isn't just for impotence, but is also used to treat ailments such as low blood pressure and altitude woes.
(Given that some of these soldiers are no doubt trained for jumping out of planes, I'm not sure about that last one.)
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