These are stories Report on Business is following Thursday, April 16, 2015.
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Cheap dates and Volkswagens
Canadian consumers are paying relatively high prices compared to several other countries.
Indeed, a "cheap date" is anything but. Though it's cheaper than a year ago when you look at it in a certain light.
(Hopefully with the lights low, given that it's a date.)
Deutsche Bank's fourth annual look at global prices, which looks at costs on the basis of purchasing power parity, ranks Canada fairly high. Not as high as Australia, the world's costliest country for consumers, but above the likes of, say, France, Germany and japan, where developed countries are concerned.
The Deutsche Bank study looks at everything from the cost of car rentals, iPhones, five-star hotels, Coke, beer, public transport, gas, cab fares, movies, gym memberships, Volkswagens, haircuts, office space, business school tuition and a pair of Levis 501.
The study is fascinating, particularly in light of the wild fluctuations in currency markets over the past year, and, in Canada's case, the hefty depreciation of the loonie against the U.S. dollar.
"A key finding of this year's survey is the extent to which exchange rate movements impact relative prices across countries," the report said.
"In previous years, Australia had consistently been the world's most expensive country while the United States had been the cheapest developed country," it added.
"This year, however, the strength of the [U.S. dollar] has significantly narrowed the gap between the two. Similarly, shopping in Europe and Japan now feels a lot cheaper than before."
There are some interesting findings where Canada is concerned, particularly if you wear Levi's with a button-fly or you're looking for a weekend quickie getaway.
For example, the United States is still the cheapest country for an iPhone 6, and among the cheapest for those Levi's.
"Barring India and Canada, it is also the cheapest place to buy a pair of Levi's 501," the report said.
"For a quick weekend getaway, Sydney, Paris and London remain the most expensive due to high hotel room rates," it added.
"Mumbai and Delhi are the cheapest but Tokyo, Ottawa and Toronto were found to be surprisingly attractive."
(Hey, honey, if we have to choose between Paris and Ottawa …)
My favourite in this report has always been its "cheap date index."
(Maybe because I am.)
It looks at the cost of cab rides, dinner at McDonald's, drinks, two movie tickets and "a couple of beers."
Among 31 cities ranked, Toronto and Ottawa are fairly high, at $76 (U.S.) and $71.90, respectively. But cities such as Paris, Berlin, Melbourne, London, New York, Boston and San Francisco are still far higher.
Then there are cities like Moscow, where the ruble has collapsed, Rio de Janeiro and Shanghai, where costs are far lower, at $43.10, $48.50 and $55, respectively.
And in Toronto, the cost is well down from last year's study because of the shift in the loonie.
It was more expensive last year because the Canadian dollar was overvalued, but on a purchasing-power-parity basis is now much nearer to what's deemed fair value.
Which means it's cheaper than last year when measured against certain other countries.
Some observers see the loonie sinking further still, although it has spiked on yesterday's comments from the Bank of Canada, which painted a brighter economic picture going forward, and "tremendous rally" in oil prices, said chief currency strategist Camilla Sutton of Bank of Nova Scotia.
Together, she added, those two events create a case to "cover off your short-Canada position."
- Summer on the patio (and many other things) soon to cost more
- The dark side of a weak loonie: Prices for food, clothes, books shoot up
- Barrie McKenna: Poloz reiterates bright outlook as Bank of Canada holds key rate
- David Parkinson: Poloz's economic optimism is built on a shaky foundation
- See the Deutsche Bank study
Wynne unveils changes
Ontario will sell off 60 per cent of electricity utility Hydro One to the private sector, allow 450 grocery stores across the province to sell beer and impose a new tax on the beverage, The Globe and Mail's Adrian Morrow reports.
These are the centrepieces of Premier Kathleen Wynne's plan to find money to pay for her program of transit construction, unveiled this morning by Ed Clark, the former TD chief advising the Premier on managing government assets.
The changes will raise an estimated $4-billion for transit, but the majority of the cash from the Hydro One sale – $5-billion – will actually be used to pay down the utility's debt.
- Adrian Morrow: Ontario to sell 60 per cent of Hydro One, impose new beer tax
- Jane Taber: Ontario to deliver budget April 23
Citi, Goldman profits rise
Two of America's big banks are boasting stronger profits today.
Citigroup Inc. topped the estimates of analysts with a first-quarter profit of $4.8-billion (U.S.), or $1.51 a share, or $1.52 when one-time items are stripped out.
"While some businesses faced revenue headwinds, we grew loans and deposits in our core businesses and gained wallet share among our target clients," said chief executive officer Michael Corbat.
Goldman Sachs Group Inc. profit climbed to $2.8-billion or $5.94 a share.
"Given more normalized markets and higher levels of client activity, we remain encouraged about the prospects for continued growth," said CEO Lloyd Blankfein.
- Citigroup profit jumps as legal, restructuring costs fall
- Goldman profit gets boost from increased trading
Magna sells unit
Magna International Inc. is selling virtually all of its vehicle interiors operations to a Spanish company for about $525-million.
The deal will Grupo Antolin involves 36 plants with some 12,000 employees around the world, which together account for $2.4-billion in annual revenue.
"This transaction is consistent with our strategy of refining our product portfolio to focus on certain key areas of the vehicle," said Magna chief executive officer Don Walker.
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