The week ahead: Bank of Canada expected to hold rates steady

Jobs reports coming Friday

By: IE Staff
March 4, 2007 March 4, 2007
14:50

The Bank of Canada makes its interest rate announcement on Tuesday. Economists expect the key overnight rate to remain unchanged at 4.25%.

Tuesday’s rate announcement is just one highlight in a crowded calendar of economic news.

On Monday, the Ivey Purchasing Managers Index for February is released. A reading of 55 is forecast, up from 53.8 the previous month.

On Tuesday, Statistics Canada reports on building permits for January. Economists expect an increase of 1.7%, compared with a decline of 7.8% the previous month.

On Thursday, Canada Mortgage and Housing Corp. reports on housing starts for February. Economists are expecting 215,000 annualized starts, down from a revised figure of 248,500 a month earlier.

Separately, StatsCan releases the new-housing price index for January. Economists expect a 0.3% monthly increase, compared with no change the previous month.

On Friday, StatsCan releases its labour force survey for January. Economists expect the addition of 10,000 new jobs, compared with 88,900 a month earlier. The unemployment rate is expected to remain unchanged at 6.2%.

Separately, the government agency reports on international merchandise trade in January. Economists expect a surplus of $4.8 billion, down from $5 billion a month ago.

South of the border

On Monday, the U.S. Institute for Supply Management releases its service sector index for February. Economists expect a reading of 57, down from 59 a month ago.

On Tuesday, the U.S. Department of Commerce reports on factory orders for January. Economists expect a decline of 4%, compared with a gain of 2.4% the previous month.

On Wednesday, the U.S. Federal Reserve Board reports on consumer credit in January. Economists expect an increase of US$7 billion, up from US$6 billion the previous month.

Separately, the Fed issues its Beige Book, a summary of economic conditions in its 12 districts.

On Thursday, the U.S. Department of Labor reports initial jobless claims for the week ended March 3. Economists expect 335,000 claims compared with 338,000 the previous week.

On Friday, the U.S. Commerce reports on the trade balance for January. Economists expect a deficit of US$60 billion, compared with a deficit of US$61.2 billion the previous month.

Separately, Commerce reports on wholesale inventories for January. Economists expect no change, compared with a decline of 0.5% the previous month.

Meanwhile, the U.S. Department of Labor reports on unemployment in February. Economists expect the rate to remain unchanged at 4.6%.

Corporate earnings

Bank earnings season wraps up this week. On Tuesday, Bank of Nova Scotia reports first-quarter results. Canadian Western Bank reports Q1 results on Thursday.

Other companies scheduled to release quarterly earnings include: