Highlights, Economic and Financial Review
Planiprêt | 23 October 2023
- Global growth is showing signs of slowing as the full effect of interest rate hikes is starting to be felt more acutely. The central banks have indicated that policy rates will have to remain higher for longer to lower inflation sustainably.
- The U.S. economy continues to be particularly resilient owing mainly to household spending, while the economy in the euro area is edging closer to a recession.
- In the second quarter, the Canadian economy dipped 0.2%, contracting for the second time in the last three quarters. Household consumption pulled back sharply, while residential investment and net exports declined.
- In Québec, real GDP declined 1.9% in the second quarter, a much larger decrease than in Canada as a whole, while the labour market sputtered.
- The major stock markets were down in the third quarter, rattled by inflationary pressures, rising interest rates and the risk of a significant slowdown in the global economy.
- Bond yields rose strongly at the end of the quarter, with investors expecting central banks to keep their key policy rates relatively high for several more quarters.
Source: Economic and Financial Review AMF
Read more: Economic and Financial Review - Third Quarter 2023
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