Every week we bring you the biggest currency, business, and travel news. This week: Yellen to speak, Amazon, NAFTA, real estate, and softwood lumber.
Janet Yellen is due to speak today (Friday, August 25) at Jackson Hole in Wyoming. Every August central bankers from around the world meet at the scenic location to discuss the global economy. Yellen’s speech will be closely analysed for any insight into potential changes in monetary policy. But it could be her last such appearance as she enters her final year as Fed Chair with President Trump far from an admirer. ECB (European Central Bank) president Mario Draghi will also speak.
The next Fed meeting is on September 19th. The US, UK and Canada have all had solid growth but relatively low inflation. Wages are also lagging behind despite falling unemployment.
Amazon has nearly completed its takeover of Whole Foods – which has 13 Canadian locations – for about $14 billion. Amazon has promised lower prices. Founder Jeff Bezos has said that the company is “determined to make healthy and organic food affordable for everyone” without sacrificing standards. Amazon Prime will also be integrated with the store, and all of the brands owned by Whole Foods will be available on Amazon.
Canada, the US, and Mexico have all signed confidentiality agreements regarding the impending NAFTA renegotiations in order to minimise the risk of leaks. The agreement will last for four years after the negotiations end. Such agreements have been deemed ‘standard’ but still show that the renegotiation process is progressing.
Real estate volatility
According to the Toronto Real Estate Board, Toronto home prices have fallen 19% since they peaked in April and resales are down 40% year on year in July. The fall is in part due to the fact that many people made bids for homes as prices peaked and now want to back out of the deal. Lenders have also reduced the amount that they are willing to lend, forcing buyers to desperately look to make up the difference between their mortgage value and the cost of the house. Overall homes are now being valued considerably lower.
In April Trump imposed duties as high as 24% on Canadian softwood lumber, now Canada is hitting back. David MacNaughton, Canada’s ambassador to the UN, has condemned the move saying, “We’re going to try really hard in the next little while to get a fair and balanced agreement. If that is not possible, we have all agreed that we will take all necessary steps to litigate this matter.”
Stay informed. Stay Current.