Inflation And Rising Costs Archives

Feds step in to end labour disputes at Canadian ports

November 13, 2024/in BizNews This Week, Fair Rules, Food Security, Global Uncertainty, Government Federal, Inflation And Rising Costs, Transportation Options/by Jim Zeeben

The Chamber was part of advocacy efforts that succeeded in ending the recent labour disputes that had shut down vital ports across Canada.

The Chamber was a signatory to a letter that went directly to federal Minister of Labour and Seniors Steven MacKinnon. That effort helped push the Canada Industrial Relations Board to announce on Tuesday that it will impose final binding arbitration to resolve labour disputes at ports in British Columbia, Montreal and Quebec.

This decision will swiftly end disruptions and resume port operations, while extending current collective agreements until new ones are finalized.

“As an Island economy, we need our supply chains to operate efficiently,” Chamber CEO Bruce Williams said. “Any disruptions can have critical impacts on businesses ability to plan with certainty.”

Canada Post could face labour disruption this week

November 13, 2024/in BizNews This Week, Fair Rules, Finding And Keeping Workers, Inflation And Rising Costs/by Jim Zeeben

The Canadian Union of Postal Workers and Canada Post are preparing for labour action as early as this Friday. The consequences could impact businesses ability to use the postal service to deliver documents and goods.

Last week, a solidarity rally was held outside the Canada Post facility in Saanich to send a message that employees are united in their demands. Meanwhile, Canada Post said it intends to continue operations regardless of what happens, though a strike would likely delay deliveries.

“Businesses need certainty so they can plan for expenses needed to provide services or goods. Any disruption that adds uncertainty creates risk and can be especially stressful for many small businesses operating with tight margins,” Greater Victoria Chamber of Commerce CEO Bruce Williams said in a statement to Black Press. “We’re hoping the two sides can continue negotiations to achieve a fair agreement that allows this national institution to continue to serve Canadians while keeping good jobs in our region.”

Business in Greater Victoria impacted by a strike can turn to local delivery services.

Maximum Express, Courier, Freight and Logistics announced this week it’s offering to deliver mail for $6 per delivery to help reassure businesses in case a postal strike happens.

Supersized interest rate cut aims to spur economy

October 23, 2024/in BizNews This Week, Business And Economic Strength, Global Uncertainty, Inflation And Rising Costs/by Jim Zeeben

Does today’s news from the Bank of Canada mark the start of better times? Maybe.

There is certainly plenty of buzz surrounding this morning’s announcement that the policy interest rate has been cut by 0.5% to stand at 3.75%. It’s the biggest drop since 2020, back when the bank needed to reassure an economy frozen by fear in the early days of the pandemic.

To better understand today’s situation, the following post by RBC is helpful. Cutting Through Interest Rate Chatter: What Interest Rate Changes Really Mean for You offers a few ways to think about today’s news. The cut has potentially created a “sweet spot” for first-time home buyers. As more people decide the time is right to list their house, buyers might be able to take advantage of a lag in prices before they return to previous levels.

Today’s rate cut is also welcome news for homeowners needing to renew mortgages. The landscape looks much better than it did before the Bank started its series of four straight rate cuts. Variable mortgage holders will also feel immediate relief with more money staying in their pockets or going toward their mortgage’s principal.

And best of all, more rate cuts appear to be on the horizon. According to the Bank of Canada’s Governing Council, it will continue to lower the rate if the economy stays on its expected path.

Stormy seas for businesses right now but smoother sailing coming

September 18, 2024/in BizNews This Week, Business And Economic Strength, Global Uncertainty, Inflation And Rising Costs/by Jim Zeeben

Businesses in Canada aren’t feeling great about current conditions but many sense brighter times ahead. That was the finding of the latest Canadian Survey on Business Conditions by the Canadian Chamber’s Business Data Lab.

“In fact, this is now the best showing for the ‘year-ahead’ question in the almost three years,” says Stephen Tapp, Chief Economist at the Canadian Chamber of Commerce. “Interest rates are beginning to fall across the developed world, the Bank of Canada is increasingly winning the war against inflation, and businesses are expecting a soft landing, with employment growing modestly over the next three months. And while we have signs of good news, businesses remain worried about fragile supply chains due to ongoing labour disputes across Canada’s transportation network.”

Indigenous-owned firms in Canada stood out as particularly optimistic about their future business opportunities.

Inflation returns to target 2% opening door to rate cuts

September 18, 2024/in BizNews This Week, Inflation And Rising Costs/by Jim Zeeben

With inflation finally — finally — back to 2% and the Bank of Canada signalling a new round of deep cuts to interest rates, there’s a growing sense of optimism among many business owners.

“I think we’re all a little weary of rising prices and the sense of uncertainty that has hung around the last few years,” Chamber CEO Bruce Williams said. “The latest economic signals are hopefully a sign that stability has returned and businesses can invest in their organizations with a more predictable outcome.”

Cheaper gas and clothing as well as lower mortgage costs have helped to stabilize inflation at 2% — the target rate that the Bank of Canada says indicates sustainable growth.

Meanwhile, the federal government continues to try and spur housing growth. New rules announced this week will make it easier for young Canadians to own their home.

The $1 million price cap for insured mortgages has been increased to $1.5 million, and more first-time homebuyers will be eligible for 30 year mortgage amortizations.

Both changes take effect Dec. 15.

Real estate summer slowdown typical for the season

September 4, 2024/in BizNews This Week, Housing, Inflation And Rising Costs/by Jim Zeeben

Despite falling interest rates, Greater Victoria’s housing market slowed in August and the benchmark price for an “average” home in the region decreased.

A total of 545 properties sold in the Victoria Real Estate Board region this August, down 16.5% from July. The benchmark value for a single family home in August was $1,287,400, down from July’s value of $1,296,100.

“The final month of the summer is generally a rather relaxed one in terms of real estate sales and listings,” 2024 Victoria Real Estate Board Chair Laurie Lidstone said. “Many folks pause their home shopping activities or pause their sales listing to make the most of other summer activities and vacations. It’s no surprise that sales this year were so close to the sales from 2023 and that listings declined slightly from the number we saw in July.”

Bank cuts rate again this morning; more cuts coming?

September 4, 2024/in BizNews This Week, Inflation And Rising Costs/by Jim Zeeben

As expected, the Bank of Canada reduced its target for the overnight rate to 4.25%.

The announcement, made this morning, reflects the consistent decline in inflation, which came in at 2.5% in July.

“With continued easing in broad inflationary pressures, Governing Council decided to reduce the policy interest rate by a further 25 basis points,” the bank said in its statement. “Excess supply in the economy continues to put downward pressure on inflation, while price increases in shelter and some other services are holding inflation up.”

The next rate announcement is Oct. 23, with another reduction expected.

Slowing inflation paves way for further interest rate cuts

August 22, 2024/in BizNews This Week, Global Uncertainty, Inflation And Rising Costs/by Jim Zeeben

The wind appears to be out of the sails of inflation, clearing the way for reduced borrowing costs later this year.

Statistics Canada reported yesterday that the Consumer Price Index rose 2.5% in July, the slowest pace since March 2021. Lower costs for phone services, computers and vehicles offset a slight increase in fuel prices.

“Businesses that have been wary of taking on debt will be a little more optimistic at the prospect of borrowing to invest in the growth of their operations,” Chamber CEO Bruce Williams said. “The economy needs that dynamic to become more productive, increase revenue and provide opportunities to incentivize staff with higher wages and workplace initiatives.”

Slowing inflation won’t bring back lower costs but it will give the Bank of Canada a clear signal to further reduce interest rates.

However, a looming rail strike could impact supply chains and lead to pressure on the price of goods.

In case you missed it yesterday, you can listen to Bruce Williams speaking about inflation and the rail strike on CBC Radio.

Bank of Canada cuts interest rates again, as expected

July 24, 2024/in Business And Economic Strength, Inflation And Rising Costs/by Jim Zeeben

The Bank of Canada has further reduced its overnight rate.

The cut was widely expected by economists as inflation appears to be under control and heading back to the target 2% rate. The next opportunity to further reduce interest rates is in September.

The Bank also released its Business Outlook Survey and its Canadian Survey of Consumer Expectations on July 15. Both reports found that public expectations for future inflation are in line with Bank forecasts.

Real estate market continues showing signs of calm

July 3, 2024/in Business And Economic Strength, Finding And Keeping Workers, Housing, Inflation And Rising Costs/by Jim Zeeben

The region’s real estate market appears to have taken a deep breath in June, as overall sales were down 13.4% from May. The numbers reflect seasonal expectations.

“I think this is good news, as the more stable the market is, the more it supports both buyers and sellers,” Victoria Real Estate Board Chair Laurie Lidstone said in a media release. “If we continue to see seasonal norms in our market, the upcoming summer months will be slower and quieter than spring was, as consumer priorities shift to vacations and outdoor pursuits. If the pattern continues, we’ll likely see an increase in activity as fall nears.”

There were 3,460 active listings at the end of June, up 3.7 % from May.

June’s benchmark value in the Victoria Core was $1,295,500 for a single family home and $567,900 for a condo.