(January 7 – 17:30 ET) – Analysts at CIBC World Markets Inc. see strong economic indicators in today’s U.S. jobs report. Still, they say, interest rates will probably rise too.
Canadian employment gains beat expectations once again, pushing CIBC to raise its GDP estimates. The firm says employment improvements should boost consumption enough to push fourth-quarter GDP up to 4% annualized growth.
“Expect much of the same in 2000,” the firm says. “Strengthening consumer confidence and domestic demand (combined with a heightened level of U.S.-bound exports) support our call for 3.5% growth for the year.”
The economy remains on track with continued job growth. The CIBC analysts believe that growth gives the Bank of Canada plenty of latitude to join the U.S. Federal Reserve Board in raising interest rates.
“Look for the Bank to match the Fed on two more rate hikes – something that the short end of the Canadian curve has more than priced in.”