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These are stories Report on Business is following Wednesday, Jan. 30, 2013.

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Household borrowing picks up again
The pace of consumer borrowing is climbing again in Canada, according to a new reading that comes just a week after the Bank of Canada took its finger off the rate trigger because the credit picture was improving.

"Awkward" is how deputy chief economist Douglas Porter of BMO Nesbitt Burns puts it.

To be sure, as the central bank noted, the pace of consumer borrowing is easing, though the key debt-to-income level in Canada is expected to remain near a record because credit growth is still eclipsing income gains.

This is a touchy issue in Canada and comes after repeated warnings from Bank of Canada Governor Mark Carney and moves by Finance Minister Jim Flaherty to tame the mortgage market and cool down the real estate sector.

In fact, the housing market has cooled. And last week, the central bank backed away from its threat to raise interest rates because household borrowing was so out of hand.

Here's what Mr. Carney and his colleagues on the central bank's policy-setting panel said: "While some modest withdrawal of monetary policy stimulus will likely be required over time, consistent with achieving the 2 per cent inflation target, the more muted inflation outlook and the beginnings of a more constructive evolution of imbalances in the household sector suggest that the timing of any such withdrawal is less imminent than previously anticipated."

In its Monetary Policy Report, the Bank of Canada said household credit growth had slowed to slightly more than 3 per cent in a three-month period ending in November, marking the slowest pace since 1999 and below the rate of about 5.5 per cent through most of last year.

But, Mr. Porter noted, consumer borrowing "popped" last month, marking a three-month pace of 4.8 per cent.

"The latest month doesn't change the bigger picture – household borrowing is slowing steadily," Mr. Porter said.

"But, it's still outgunning income growth, and it's hardly in free fall."

RIM's big day
Shares of Research In Motion Ltd. are sliding today even as the company dives into its comeback plan with the launch of its BlackBerry 10 models.

Chief executive officer Thorsten Heins unveiled the models in New York, and announced the company is changing its name to BlackBerry, which will trade on Nasdaq as BBRY and on the Toronto Stock Exchange as BB.

In an interview with The Globe and Mail's Iain Marlow, Mr. Heins said feedback from wireless carriers and dedicated customers around the world leave him convinced that RIM now has the technology to succeed. RIM is deploying a product platform it has carefully worked to perfect even as it grappled with losses, layoffs, delays and devastating drops in market share to giant rivals such as Apple Inc. and Samsung Electronics Co.

The first device to launch is the BlackBerry Z10, a full touchscreen device with a display slightly bigger than an iPhone. It will launch in the United Kingdom on Jan. 31, in Canada on Feb. 5 and in March for U.S. consumers. The BlackBerry Q10, which has both a touchscreen and a physical QWERTY-keyboard, will launch on global carriers starting in April. Both devices will cost about $600 without a subsidy from a wireless carrier, and roughly $199.99 on a three-year contract.

U.S. economy stalls
The U.S. economy stalled out at the end of last year, unexpectedly contracting at an annual rate of 0.1 per cent in the fourth quarter.

Today's numbers from the Commerce Department mark the first contraction in three and one-half years, and are a far cry from the third quarter's growth rate of 3.1 per cent.

Suffering a sharp pullback in government spending, a drop of more than 6.5 per cent, the over all contraction flies in the face projections among economists for growth in the 1-per-cent range. Defence spending fell at the fastest pace in about 40 years, while a decline in exports also hurt.

Still, consumer spending picked up by more than 2 per cent, while investment among businesses climbed by more than 8 per cent.

While hit by government spending and a cut in inventories among businesses, the numbers highlight the still-fragile nature of the post-crisis economy. The euro zone is in recession amid a debt crisis, China's growth is slowing, and forecasts for Canada have been cut as well.

But as chief U.S. economist Paul Ashworth of Capital Economics put it, today's result may well be the "best-looking contraction" you'll ever see.

"Admittedly, the decline in exports reflects the weakness of global demand," he said.

"But the drag from defence spending and inventories is a one-off. The rest of the report is all encouraging. Despite the looming fiscal cliff and Superstorm Sandy, consumption growth accelerated to 2.2 per cent, from 1.6 per cent, while business investment increased by 8.4 per cent, more than reversing the 1.8-per-cent decline in the third quarter ... First-quarter GDP growth is going to be pretty weak because of the expiry of the payroll tax cut. But there is nothing in these figures to change our view that U.S. GDP growth will accelerate as this year goes on."

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