Trade wars and tariffs, and many other aliments don’t seem to be impacting Canada’s business owners, but? Gross Domestic Product (GDP) crept up mildly by .1% or 10 basis points with the Friday, June 29 Statistics Canada announcement. Results were modestly in-line with Canada’s economic expectations for April 2018. These results coincided with Bank of Canada (BoC) survey taken BEFORE the G7 June kerfuffle which also offered positive sentiment from private business, as outlined by Investment Executive Canada.
How have trade talks impacted business sentiment?
While we have no formal data yet, the Globe and Mail offer an opinion that Canada’s outlook would be rosy “if it wasn’t for that U.S. trade war.” Before the ‘Trump’ tariff and trade friction, a focus towards full-employment and hiring had increased substantially. As outlined by the NBF Economics chart below Canadian firms were eager to hire at the expense of investment. However, the business outlook has weakened.
“Despite an upbeat outlook, the balance of opinion on investment moved downward and that even though “almost all interviews” were conducted before the announcement of tariffs on steel and aluminum imports from Canada by the U.S. Business optimism likely took a subsequent dive, especially after the disastrous G7 meeting of June 8th/9th when Canada-U.S. trade relations took a turn for the worse.”
It may have become ‘Oh, Oh’ Canada as business sentiment survey before the G7 meetings enjoyed some of the most positive sentiment since 2011. What is next? For a fulsome discussion on how the recent geopolitical trade wars may impact our future economic outlook, enjoy the detailed discussion from our partners at NBF Economics, HERE.
Trade wars and counter measures never result in positive outcomes with the exception of local sourcing. Here’s a quick review of the potential provincial impacts from CTV News. As consumers we may wish to spend your summer travels and vacation supporting local producers to the benefit of many.