january 27, 2017 - microsoft · 2017-01-30 · january 27, 2017 week in review canada – wholesale...

January 27, 2017

Week in review

Canada – Wholesale sales rose 0.2% on a month-on-

month basis in November to $56.9 billion. Motor vehicles and parts recorded a 5.8% retreat while the miscellaneous sector, which includes paper and plastic products as well as agricultural supplies and chemicals, nudged up by 7.2%. Total sales, excluding motor vehicles and parts, advanced by 1.6%. Expressed in volumes, sales slid by 0.1% The Survey of Employment, Payrolls and Hours (SEPH) showed Canada adding 25K net new jobs in November. That took the tally for the first 11 months of 2016 to 141K, or an average of 13K net new jobs/month which is much lower than the Labour Force Survey’s tally of 20K jobs/month for paid employment over the same period. The SEPH’s year-on-year earnings growth was just 0.8% in November. The lack of wage growth and stagnating hours worked are not encouraging but they are in line with the slow moving economy last year.

United States – Q4 GDP growth came in at 1.9%

annualized, disappointing consensus which was looking for a print of 2.2%. Trade was a major drag on growth as exports fell

and imports rose. But domestic demand more than compensated for that thanks to gains for consumption, government spending (mostly at the state level), residential investment and even business investment. Inventories added 1% to growth, meaning that final sales, i.e. GDP excluding inventories, grew slower than GDP, i.e. just 0.9% (albeit after two strong quarters). Nominal GDP grew at an annualized pace of 4%, on top of the prior quarter’s 5% increase. The personal savings rate fell two ticks to 5.6%.

Overall those results were mixed. More than half of the growth in Q4 came from inventory accumulation, partly a result of weak exports. That suggests a period of destocking ahead, which is not good news for production in Q1. On the bright side, domestic demand was strong again, with contributions from all sub-components including investment in equipment. Moreover, nominal GDP continued to grow at a healthy clip, a positive for public finances. All in all, the U.S. economy grew 1.6% last year (or 2.9% in nominal terms). The decent handoff from last year (i.e. Q4 real growth) coupled with fiscal stimulus should help boost U.S. real GDP growth to around 2.2% in 2017. Business investment, which was soft last year, should bounce back with the stabilisation of oil prices and the apparent increase in confidence in light of promises of tax cuts and deregulation by the new administration. The durables goods report showed new orders falling 0.4 % in December, well short of consensus which was expecting a solid increase of 2.5%. Orders fell sharply in the transportation category as gains for civilian aircrafts and autos were more than offset by a massive drop in defense orders. Ex-transportation, orders rose a consensus-matching 0.5% while ex-defense new

What we’ll be watching (p. 3) Calendar of upcoming releases (p. 5) Annex – Economic tables (A1)

WEEKLY ECONOMIC WATCH

2

orders were up 1.7%. Total shipments of non-defense capital goods ex-aircraft, a proxy for business investment spending, rose 1%. Orders of non-defense capital goods ex-aircraft were up sharply in Q4 (more than shipments), suggesting gains in investment spending could extend to early 2017. That’s good news for the economy’s potential. The Markit manufacturing purchasing manager’s index (PMI) improved from 54.3 in December to 55.1 in January. This was the fifth consecutive month for which results exceeded expectations and the fourth consecutive monthly gain. The index now stands at its highest level since March 2015 and its trend suggests growing activity in the manufacturing sector. The output sub-index led the way upward, surging from 55.1 last month to 56.7, thereby extending its 8-month long streak of gains. The new orders index also rose at its fastest pace in 28 months. The Markit services PMI also beat expectations and climbed to 55.1, its highest reading since November 2015. New home sales dropped 62K to 536K in December. This was much below expectations (588K) and represented a ten-month low. The lacklustre figure means that it would now take 5.8 months to sell the outstanding stock of new homes in the U.S., the highest figure since September 2015. More new houses are now available on the market (259K) than at any time since 2009. On a less sombre note, the median selling price climbed 7.8% compared with November to reach $322,500. Existing home sales declined by 2.8% month-on-month in December to reach an annual pace of 5.49 million transactions. Sales of single-family homes fell 1.8% while those of multis dropped 10.3%. Despite December’s decline, total sales for 2016 climbed to 5.45 million compared to 5.25 million a year earlier. Those are the best full-year numbers since 2006. Inventories, now standing at 1.65 million properties, are at their lowest levels since the National Association of Realtors began recording this indicator in 1999. As of now, inventories represent 3.6 months of sales. Any level below 5 months indicates a tight market. Initial jobless claims rose 22K to 259K in the week ending on January 21st. This was more than the 247K expected by consensus. The hike is partially explained by seasonal factors like the laying off of employees hired for the holiday season and the reduced activity in the construction sector due to weather conditions. Jobless claims have been volatile recently, but the more stable 4-week average, which now stands at 246K, is at its lowest since 1973.

World – In Japan headline CPI beat expectations and

progressed 0.3% on a year-on-year basis for the month of December. Most of the rise can be attributed to a 13.8% surge in the price of fresh food. The pace of decline of the CPI ex-fresh food, the Bank of Japan’s preferred measure of core inflation, slowed to -0.2% year-on-year in December after posting a -0.4% drop in November. With a weaker yen and the price of oil picking up, we reckon that core inflation may have bottomed out. This is

good news, but without more convincing wage growth and consumer spending, it will not be sufficient to justify a change of policy by the BoJ at its next meeting scheduled on January 28th-29th. In Europe, the preliminary Eurozone purchasing managers’ index came in a little weaker than expected in January. The Composite PMI dropped 0.1 point albeit from a posted reading of 54.4 in December, the highest in 2016. The manufacturing component continued to improve (from 54.9 in December to 55.1 in January) while the services sub-index shed 0.1 point to 53.6. The new orders component remained flat month-on-month and still stands at a multi-month high. Germany’s PMI lost 0.5 point to 54.7 driven by a significant decrease in the services component. In France, the composite reading easily beat expectations and came in at 53.8, stimulated by a surge in the services sub-index. France’s PMI is catching up with Germany’s, with both remaining comfortably into expansionary territory (>50).


What we’ll be watching

3

In Canada, a light yet important data week will feature November GDP. Output is expected to increase 0.3% which would make up for the prior month’s slump. Our optimism rests on solid gains reported in the

manufacturing and retail sectors. The big jump in real exports of energy suggests some contribution from the energy sector. The financial services sector may also have expanded thanks in part to solid home sales during the month. Governor Stephen Poloz from the Bank of Canada is scheduled to give a speech on Tuesday evening.

In the U.S., the highlights of the week will be the Fed’s monetary policy decision and non-farm payrolls for January. The Federal Open Market Committee which meets on Wednesday is likely to keep interest rates at

0.75% following December’s rate hike. The big question will be if the statement gives clues about what the Fed intends to do with its balance sheet. The latter could be used as an additional measure to cool the economy. Non-farm payrolls could show a pick-up in the pace of employment creation. The rate of layoffs dropped during the month based on weekly initial jobless claims, while hiring may have found support from the apparent improvement in business confidence—the NFIB index jumped in January to its highest level in 12 years. As such, we expect net employment creation of roughly 170K. The household survey, which tends to be a more volatile measure, could see a pick-up in employment growth after a soft December. However, we expect the unemployment rate to remain unchanged at 4.7%. The ISM manufacturing index may have increased in January if Markit’s factory purchasing managers index is any guide.

Previous

GDP (November m/m chg.) -0.30%

NBF forecasts

0.30%

Previous

Fed funds rate 0.75%

Non farm payrolls (January m/m chg.) 156K

Unemployment rate (January) 4.70%

ISM manufacturing (January) 54.7

NBF forecasts

0.75%

170K

4.70%

55.0


What we’ll be watching

4

Elsewhere in the world, Japan will release December data on retail trade and the unemployment rate. The Bank of Japan will meet on Tuesday to decide on monetary policy. The BoJ’s minutes for the previous meeting will be available on Thursday. The Eurozone will

also have an important week featuring preliminary results for Q4 GDP and a new economic bulletin from the European Central Bank. China will release January’s non-manufacturing PMI.


Consensus Cons.

Estimate EPS

8:30 US Personal Income Dec 0.00% 0.40% 0.40% Affiliated Managers Group Inc Bef-mkt Q4 16 3.71

8:30 US Personal Spending Dec 0.20% 0.40% 0.40% Leggett & Platt Inc Aft-mkt Q4 16 0.58

8:30 US PCE Deflator YoY Dec 1.40% 1.70% UDR Inc Aft-mkt Q4 16 0.46

8:30 US PCE Core YoY Dec 1.60% 1.70% GGP Inc 16:01 Q4 16 0.43

10:00 US Pending Home Sales MoM Dec -2.50% 1.50% Principal Financial Group Inc 16:15 Q4 16 1.14

8:30 US Employment Cost Index 4Q 0.60% 0.60% Simon Property Group Inc Bef-mkt Q4 16 2.56

8:30 CA GDP MoM Nov -0.30% 0.30% 0.30% Thermo Fisher Scientific Inc Bef-mkt Q4 16 2.38

8:30 CA Industrial Product Price MoM Dec 0.30% -- Danaher Corp 06:00 Q4 16 1.03

8:30 CA Raw Materials Price Index MoM Dec -2.00% -- Eli Lilly & Co 06:25 Q4 16 0.98

9:45 US Chicago Purchasing Manager Jan 54.6 55.0 Pfizer Inc 06:45 Q4 16 0.50

United Parcel Service Inc 07:45 Q4 16 1.69

Mastercard Inc 08:00 Q4 16 0.86

Exxon Mobil Corp 08:00 Q4 16 0.70

Chubb Ltd Aft-mkt Q4 16 2.41

Anadarko Petroleum Corp 16:05 Q4 16 -0.44

Apple Inc 16:30 Q1 17 3.22

Aetna Inc 06:00 Q4 16 1.44

7:00 US MBA Mortgage Applications Jan-27 4.00% -- CGI Group Inc Bef-mkt Q1 17 0.91

8:15 US ADP Employment Change Jan 153k 165k Automatic Data Processing Inc Bef-mkt Q2 17 0.81

9:45 US Markit US Manufacturing PMI Jan F 55.1 55.1 Dominion Resources Inc/VA 06:00 Q4 16 1.01

10:00 US ISM Manufacturing Jan 54.7 55.0 55.0 Anthem Inc 06:00 Q4 16 1.76

10:00 US Construction Spending MoM Dec 0.90% 0.20% Baxter International Inc Bef-mkt Q4 16 0.52

14:00 US FOMC Rate Decision (Upper Bound) Feb-01 0.75% 0.75% 0.75% Marathon Petroleum Corp Bef-mkt Q4 16 0.26

14:00 US FOMC Rate Decision (Lower Bound) Feb-01 0.50% 0.50% 0.50% Johnson Controls International plc 06:55 Q1 17 0.52

Altria Group Inc 07:00 Q4 16 0.67

MetLife Inc Aft-mkt Q4 16 1.34

AvalonBay Communities Inc Aft-mkt Q4 16 2.10

Facebook Inc 16:05 Q4 16 1.31

Allstate Corp/The 16:15 Q4 16 1.63

8:30 US Nonfarm Productivity 4Q P 3.10% 1.00% BCE Inc Bef-mkt Q4 16 0.78

8:30 US Initial Jobless Claims Jan-28 259k 250k Brookfield Renewable Partners LP 07:00 Q4 16 0.11

Manitoba Telecom Services Inc 0:00 Q4 16 0.34

Saputo Inc 0:00 Q3 17 0.51

Open Text Corp 16:00 Q2 17 0.53

ConocoPhillips Bef-mkt Q4 16 -0.41

Merck & Co Inc 06:45 Q4 16 0.89

CME Group Inc 07:00 Q4 16 1.09

Philip Morris International Inc 07:00 Q4 16 1.10

Amgen Inc 16:00 Q4 16 2.79

Amazon.com Inc 16:01 Q4 16 1.37

Visa Inc 16:05 Q1 17 0.78

8:30 US Change in Nonfarm Payrolls Jan 156k 170k 170k Brookfield Property Partners LP Bef-mkt Q4 16 0.00

8:30 US Unemployment Rate Jan 4.70% 4.70% 4.70% Norbord Inc 06:00 Q4 16 0.55

9:45 US Markit US Services PMI Jan F 55.1 -- ATS Automation Tooling Systems Inc 0:00 Q3 17 0.09

10:00 US ISM Non-Manf. Composite Jan 57.2 57.0 MEG Energy Corp 0:00 Q4 16 -0.35

10:00 US Factory Orders Dec -2.40% 1.40% 0.00% Weyerhaeuser Co Bef-mkt Q4 16 0.16

10:00 US Durable Goods Orders Dec F -0.40% -- LyondellBasell Industries NV Bef-mkt Q4 16 2.15

10:00 US Durables Ex Transportation Dec F 0.50% -- AutoNation Inc Bef-mkt Q4 16 0.96

Clorox Co/The 06:30 Q2 17 1.22

Hershey Co/The 07:00 Q4 16 1.08

Phillips 66 07:00 Q4 16 0.40

Source: Bloomberg

5

Feb 3

Wednesday

Feb 1

Thursday

Feb 2

Friday

Economic releases & eventsPeriod PreviousTime

Jan 30

Monday

Tuesday

Jan 31

Earnings announcements

Economic calendar - Canada & U.S.

Country Release NBF Estimate

Company Time Qtr


Annex - Economic tables

January 27, 2017Monthly Growth (%) Annualized Growth

Growth Rates Unless Reference Past Prev. Month Average of the last Since Year-to-date (3)

Otherwise Indicated Period Level Month Month Before 3 Mos. 6 Mos. 12 Mos. ref. prec.

UNITED STATESMONETARY AGGREGATES ($Billions)

M1 * Dec 2016 3329 -0.4 0.3 0.3 4.9 8.8 8.0 7.6 7.3

M2 * Dec 2016 13185 0.3 0.6 0.4 5.9 6.7 7.1 6.8 5.8CREDIT MEASURES

Consumer Credit Nov 2016 3750 0.7 0.4 0.6 7.2 6.7 6.3 6.3 7.0Mortgage (Banks) Dec 2016 4117 0.2 0.3 0.6 5.7 6.8 6.4 6.9 4.5Business Dec 2016 2100 -0.2 0.2 0.8 5.7 6.3 7.3 9.3 11.6

CANADAMONETARY AGGREGATES

M2+ gross Oct 2016 1874 0.9 0.7 0.3 8.3 7.7 7.5 6.5 4.7Personal Deposits (Banks) (2) Nov 2016 911 0.6 0.5 0.4 6.3 7.0 7.5 7.2 3.9

CREDIT MEASURESConsumer Oct 2016 564 0.3 0.3 -0.1 2.7 3.8 3.4 3.0 3.0Mortgages Oct 2016 1416 0.4 0.6 0.5 6.1 5.9 6.1 6.3 5.6Short - Term Business Loans Sept 2016 499 0.6 1.4 -0.1 9.4 10.3 11.5 11.1 #VALUE!Business (S.T. + L.T.) Nov 2016 1832 0.5 0.6 0.3 5.8 5.6 5.3 5.2 8.2Private (Consumer+Business) Oct 2016 3804 0.5 0.4 0.4 5.7 5.2 5.2 5.2 6.5Gov. of Canada securities outstanding Dec 2016 687 -0.2 0.1 0.4 1.0 4.3 3.6 3.7 1.0

INTEREST AND EXCHANGE RATESReference Last 1 week 2 w. Average of last Thursdays 13 w. 26 w. 52 w.Thursday day ago ago 13 w. 26 w. 52 w. ago ago ago

UNITED STATESINTEREST RATES

Federal Funds Target Rate * 26 Jan 17 0.75 0.75 0.75 0.63 0.57 0.53 0.50 0.50 0.50Prime Rate * 26 Jan 17 3.75 3.75 3.75 3.63 3.57 3.53 3.50 3.50 3.503-month Treasury Bills * 26 Jan 17 0.50 0.51 0.51 0.48 0.39 0.33 0.29 0.25 0.342-year Bonds * 26 Jan 17 1.21 1.23 1.18 1.12 0.95 0.85 0.89 0.71 0.835-year Bonds * 26 Jan 17 1.96 1.95 1.87 1.83 1.51 1.37 1.35 1.08 1.4010-year Bonds * 26 Jan 17 2.51 2.46 2.36 2.36 2.00 1.87 1.84 1.51 1.9930-year Bonds * 26 Jan 17 3.09 3.04 2.96 3.01 2.69 2.61 2.60 2.23 2.79Corp. High-yield (BofA ML Master II) * 26 Jan 17 6.23 6.29 6.30 6.56 6.63 7.40 6.45 7.05 9.37Corp. Invest. Grade (BofA ML Corp. BBB) * 26 Jan 17 3.81 3.82 3.76 3.80 3.57 3.71 3.43 3.34 4.50

SpreadCorp. High-yield - Treas. 10y. * 26 Jan 17 3.72 3.83 3.94 4.20 4.63 5.54 4.61 5.54 7.38Corp. Invest. grade - Treas. 10y. * 26 Jan 17 1.30 1.36 1.40 1.44 1.57 1.84 1.59 1.83 2.52Treasuries 30y. - 3-m. T.B. * 26 Jan 17 2.59 2.53 2.45 2.53 2.30 2.28 2.31 1.98 2.45

EXCHANGE RATEFED Broad (Jan 97 = 100) * 20 Jan 17 128.04 128.06 127.41 126.57 124.03 122.82 123.06 121.22 125.23

CANADAINTEREST RATES

Prime Rate * 26 Jan 17 2.70 2.70 2.70 2.70 2.70 2.70 2.70 2.70 2.70Target overnight rate * 26 Jan 17 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.5030-day commercial paper * 26 Jan 17 0.94 0.94 0.94 0.90 0.89 0.88 0.87 0.88 0.863-month Treasury Bills * 26 Jan 17 0.46 0.44 0.47 0.48 0.49 0.49 0.51 0.54 0.481-year Treasury Bills * 26 Jan 17 0.61 0.63 0.65 0.60 0.58 0.55 0.55 0.58 0.465-year Bonds * 26 Jan 17 1.17 1.15 1.08 1.03 0.85 0.76 0.68 0.65 0.6810-year Bonds * 26 Jan 17 1.82 1.76 1.67 1.62 1.35 1.28 1.15 1.07 1.2430-year Bonds * 26 Jan 17 2.46 2.37 2.27 2.23 1.98 1.94 1.82 1.69 2.05SPREADSPrime - 30d. Commercial paper * 26 Jan 17 1.76 1.76 1.76 1.80 1.81 1.82 1.83 1.82 1.84Long Term - Short Term * 26 Jan 17 2.00 1.93 1.80 1.75 1.48 1.45 1.31 1.15 1.57

CANADA UNITED STATES SPREADS3-month T-Bills * 26 Jan 17 -0.04 -0.07 -0.04 0.00 0.11 0.16 0.22 0.29 0.14Long Term Bonds * 26 Jan 17 -0.63 -0.66 -0.69 -0.78 -0.71 -0.67 -0.78 -0.54 -0.74

EXCHANGE RATEUS$ /CDN$ (GTIS) * 26 Jan 17 0.7640 0.7508 0.7608 0.7494 0.7569 0.7604 0.7470 0.7601 0.7128Trade-weighted (1990=100) G-10 * 26 Jan 17 90.0 88.7 89.8 88.4 88.8 89.0 87.6 88.6 83.5

STOCK INDICES Monthly Growth (%) Growth Over (%)Reference Past Prev. Month Year-to-dateThursday Level Month Month Before 3 Months 6 Months 1 Year ref. prec.

Dow Jones (U.S.) * 26 Jan 17 20100.9 0.8 4.1 5.2 10.4 8.8 24.3 0.8 -7.9S&P 500 (U.S.) * 26 Jan 17 2296.7 1.5 2.3 3.5 7.4 5.9 20.6 1.5 -7.6NASDAQ (U.S.) * 26 Jan 17 5655.2 3.5 1.2 2.8 7.7 10.7 23.8 3.5 -9.5S&P/TSX (Can.) * 26 Jan 17 15615.5 1.9 1.7 1.8 5.5 7.3 26.6 1.9 -7.4

* Update (1) Commercial Banks (2) Not seasonnally adjusted (3) compared to same period of the preceeding year,Source: Thomson Reuthers Datastream unless otherwise stated

TABLE 1 - NORTH AMERICAN FINANCIAL INDICATORS

A1


Annualized Growth (%)

Growth Rates Unless Reference Past Prev. Month Average of the last Since Year-to-date (9)

Otherwise Indicated Period Month Month Before 3 Mos. 6 Mos. 12 Mos. 12 Mos. ref. prec.

Index of 12 Leading Indicators * Dec 2016 0.5 0.1 0.2 2.1 2.0 1.2 1.5 1.2 4.4Consumer Confidence Index (1985=100) Dec 2016 113.7 109.4 100.8 108.0 104.3 99.9 96.3 99.9 98.0I.S.M. Manufacturing Index (level) * Dec 2016 54.5 53.5 52.0 53.3 52.2 51.5 47.9 51.5 51.4

* Dec 2016 60.9 60.3 58.1 59.8 58.4 58.0 59.1 58.0 60.8

DOMESTIC DEMANDSales new autos & light trucks (000,000) Dec 2016 18.4 17.9 18.0 18.1 17.8 17.5 17.5 17.5 17.4Retail Sales Dec 2016 0.6 0.2 0.7 6.8 5.1 3.0 4.1 3.0 2.3

- Motor vehicle Dec 2016 2.4 -0.2 0.8 11.6 9.3 3.5 6.8 3.5 6.6- Other Dec 2016 0.2 0.3 0.6 5.5 4.0 2.9 3.4 2.9 35.5

Consumer Spending: Total ($ current) Nov 2016 0.2 0.4 0.7 -10.2 1.1 2.7 -7.6 2.7 3.6Total ($ constant) Nov 2016 0.1 0.1 0.5 2.7 3.3 2.7 2.8 2.7 3.2

Personal Income Nov 2016 0.0 0.5 0.4 4.1 4.3 3.6 3.5 3.5 4.4Personal Savings Rate (3) Nov 2016 5.5 5.7 5.6 5.6 5.7 5.9 6.0 5.9 5.8New Orders Nov 2016 -2.4 2.8 0.6 9.8 1.9 -2.3 -0.3 -2.1 -6.5

- Non-Defence Capital Goods exc. Aircraft * Dec 2016 0.8 1.5 0.5 4.7 1.8 -3.5 2.8 -3.5 -3.2Unfilled Orders * Nov 2016 -0.6 -0.3 0.8 0.8 -1.6 -1.7 -1.4 -1.7 1.6Business Inventories Nov 2016 0.7 -0.1 0.0 1.1 1.5 0.9 1.5 0.9 2.5Inventories / Shipments Businesses Nov 2016 1.38 1.37 1.38 1.38 1.38 1.39 1.39 1.39 1.38Manufacturers' Shipments Nov 2016 -0.1 0.2 0.9 4.2 2.6 -2.6 0.1 -2.4 -4.3Manufacturers' Inventories Nov 2016 0.2 0.1 -0.1 0.8 -0.3 -2.5 -0.7 -2.5 -0.8Inventories / Shipments Manuf. Nov 2016 1.34 1.34 1.34 1.34 1.35 1.36 1.35 1.36 1.36Housing Starts (000) (1) Dec 2016 1226 1102 1320 1216 1180 1168 1160 1168 1108New Home Sales, single-family * Dec 2016 -10.4 4.7 0.5 -9.7 10.8 11.8 -0.4 11.8 14.2Existing Home Sales, s.f. & condos * Dec 2016 -2.8 1.4 1.5 14.0 2.9 4.0 0.7 4.0 6.3

PRODUCTIONIndustrial Production Dec 2016 0.8 -0.7 0.2 -0.6 0.5 -1.0 0.5 -1.0 0.3

- Consumer Goods Dec 2016 1.1 -1.0 -0.2 -2.1 0.8 0.7 1.5 0.7 1.4- Hitech goods Dec 2016 0.3 -0.7 0.8 3.0 3.9 3.0 3.0 3.0 2.0

EXTERNAL AND FISCAL BALANCESExports Nov 2016 -0.2 -1.8 0.9 3.3 6.3 -3.1 1.2 -2.7 -4.6Imports Nov 2016 1.1 1.2 -1.2 2.0 5.5 -2.8 2.8 -2.4 -3.4Merch. Trade Balance ($ billions) Nov 2016 -45.2 -42.4 -36.2 -41.3 -41.5 -41.3 -41.1 -41.3 -41.7Real merchandise trade balance Nov 2016 -63.6 -60.3 -54.2 -59.4 -59.7 -59.9 -60.4 -59.8 -59.2Federal budget balance last 12 months (2) Dec 2016 -580.1 -567.1 -495.0 -478.0 -580.1 -478.0

INFLATION AND COSTSConsumer Prices Dec 2016 0.3 0.2 0.4 3.4 2.3 1.3 2.1 1.3 0.1

- Excluding Food and Energy Dec 2016 0.2 0.2 0.1 2.0 2.0 2.2 2.2 2.2 1.8PCE Deflator exc. Food and Energy Dec 2016 0.0 0.1 0.1 1.5 1.7 1.6 1.6 1.7 1.4Producer price index for final demand Dec 2016 0.3 0.4 0.0 1.8 1.4 0.4 1.6 0.4 -0.9Average Hourly Earnings (4) Dec 2016 0.3 0.0 0.2 2.3 2.5 2.5 2.5 2.5 2.1Industrial Capacity Utilization Rate Dec 2016 75.5 74.9 75.4 75.3 75.4 75.4 75.4 75.4 76.7Median Price, Single-Family Homes (5) * Dec 2016 -1.1 0.2 -0.5 -10.0 8.2 5.5 3.8 5.5 6.9

LABOUR MARKETNew Jobs (000) (6) Dec 2016 156 204 135 165 189 180 2157 2157 2744

- Manufacturing (000) Dec 2016 17 -7 -4 2 -2 -4 -45 -45 26- Services (000) Dec 2016 144 191 127 154 182 182 2180 2180 2558

Average weekly hours (6) Dec 2016 0.1 0.2 0.1 1.1 1.4 1.6 0.9 1.6 2.2Civilian Unemployment Rate (7) Dec 2016 4.7 4.6 4.8 4.7 4.8 4.9 5.0 4.9 5.3

NATIONAL ACCOUNTS AND OTHER Annualized Growth RatesQUARTERLY INDICATORS Q4 2016 Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q4 2015 2014 2013 2012Real GDP Chained 2009 dollars * 1.9 3.5 1.4 0.8 0.9 2.0 2.4 2.2 2.3Consumption * 2.5 3.0 4.3 1.6 2.3 2.7 2.7 3.2 2.9Residential Construction * 10.2 -4.1 -7.8 7.8 11.5 12.6 4.9 11.7 3.5Business Investment * 2.4 1.4 1.0 -3.4 -3.3 3.9 -0.4 2.1 6.0

- Machinery and Equipment * 4.1 11.8 -2.6 4.8 0.0 #VALUE! 0.0 #VALUE! #VALUE!Government Spending * 1.2 0.8 -1.7 1.6 1.0 1.9 0.9 1.8 -0.9Exports * -4.3 10.0 1.8 -0.7 -2.7 -2.8 0.4 0.1 4.3Imports * 8.2 2.2 0.2 -0.6 0.7 1.1 1.1 4.6 4.4Change in Inventories (1) (2) * 48.7 7.1 -9.5 40.7 56.9 70.9 21.8 84.0 57.7GDP Deflator * 2.1 1.4 2.3 0.5 0.9 1.2 1.3 1.1 1.8Personal Disposable Income * 1.5 2.6 2.9 2.1 3.0 3.3 2.7 3.5 3.5

Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2013 2012 2011Labour Productivity (4) 3.1 -0.2 -0.6 -2.4 2.0 1.2 0.9 0.8 0.3Unit Labor Costs (4) 0.7 6.2 -0.3 5.7 0.8 3.6 2.0 2.0 1.0

Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2013 2012 2011Current Account (current $) -451.8 -473.1 -527.4 -453.6 -492.4 -447.6 -463.0 -392.1 -366.4

as a % of GDP -2.4 -2.6 -2.9 -2.5 -2.7 -2.5 -2.6 -2.3 -2.2Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2013 2012 2011

Corporate Profits (8) 25.4 -2.4 14.1 -22.3 -3.2 -11.4 -3.0 5.9 1.7as a % of GDP 11.5 11.0 11.1 10.8 11.6 11.7 11.6 12.0 12.5

* Update Source: Thomson-Reuthers Datastream(1) Annual Rate (5) Existing Homes Sold (9) Compated to same period of the(2) $ Billions (6) Non-Farm Payroll Survey preceeding year, unless otherwise(3) Personal Savings as a % of Personal Disposable Income (7) Household Survey stated(4) Nonfarm Business (8) Current $ and before taxes

- Non-manufacturing (level)

Annex - Economic tablesTABLE 2 - UNITED STATES ECONOMIC INDICATORS

January 27, 2017Monthly Growth (%)

A2


TABLE 3 - CANADIAN ECONOMIC INDICATORSJanuary 27, 2017

Annualized Growth (%) Growth Rates Unless Reference Past Prev. Month Average of the last Since Year-to-date (6)Otherwise Indicated Period Month Month Before 3 Mos. 6 Mos. 12 Mos. 12 Mos. ref. prec.

CFIB Business Barometer ® * Jan 2017 -0.9 2.2 3.0 8.7 8.8 -0.2 10.7 10.7 -14.5

DOMESTIC DEMANDRetail Sales ($ current) Nov 2016 0.2 1.2 0.9 7.6 3.0 3.6 3.0 3.7 1.6

- Motor vehicle and parts dealers Nov 2016 0.8 0.3 2.7 12.8 0.4 6.6 1.7 6.6 5.5- Other Nov 2016 0.1 1.4 0.3 6.0 4.0 2.6 3.4 2.8 23.0

Retail Sales ($ constant) Nov 2016 0.7 0.6 0.8 6.7 1.7 2.3 2.4 2.5 1.3

Manufacturer's Shipments ($ current) Nov 2016 1.5 -0.6 0.0 3.3 1.6 0.4 2.1 0.6 -1.7New Orders Nov 2016 0.5 0.8 2.1 3.2 5.2 -0.6 2.9 -0.1 -4.2

- Durables Nov 2016 -2.0 2.4 4.7 2.5 4.3 -0.1 1.2 0.6 -2.2Unfilled Orders Nov 2016 0.0 0.6 -0.2 -3.3 0.3 -6.6 -4.2 -7.1 8.9Manufacturer's Inventories Nov 2016 -0.2 0.1 0.4 1.1 -0.5 -1.0 -2.2 -1.4 1.7Inventories / Shipments Ratio Nov 2016 1.35 1.38 1.37 1.37 1.37 1.38 1.41 1.38 1.40Manufacturer's Shipments ($ constant) Nov 2016 1.2 -1.6 -0.6 -1.1 -0.9 0.8 1.2 1.1 -1.1

Housing Starts (000) (1) Dec 2016 207.0 187.3 195.8 196.7 198.1 198.4 170.9 198.4 193.5Number of existing homes sold (MLS) Nov 2016 -5.3 2.0 1.5 -4.1 -2.7 6.9 -2.0 6.6 5.1Number of commercial bankrupties (2) Aug 1900 3.1 1.4 12.2 -15.9 -24.0 -2.3 -3.8 -4.8 -3.0PRODUCTION Real Domestic Product Oct 2016 -0.3 0.4 0.2 3.8 0.7 0.8 1.5 1.0 1.0

- Manufacturing Oct 2016 -2.0 0.8 -0.2 1.7 -1.2 0.3 -0.2 0.5 0.3- Construction Oct 2016 -0.5 0.7 -0.6 -1.9 -3.0 -4.3 -2.5 -3.6 -4.2

Services Oct 2016 0.1 0.1 0.1 1.6 1.7 1.9 1.9 2.0 2.2

EXTERNAL, FISCAL AND EXCHANGE BALANCESExports Nov 2016 4.3 0.6 -0.5 14.9 2.3 -0.8 5.2 -1.2 -1.0Imports Nov 2016 0.7 -6.2 4.2 2.9 0.5 0.2 -0.8 -0.1 4.6

- Capital Goods Nov 2016 -4.3 -19.0 23.7 30.8 -3.8 -0.7 -9.4 -1.4 8.1Merch. Trade Balance ($ millions) Nov 2016 527 -1,024 -4,246 -1,581 -2,172 -2,361 -2,081 -2,493 -2,008Change in Official Reserves Dec 2016 -412 -253 -812 -492 -134 247 2,965 2,965 3,377

Level (US$): $82.7 billion Fiscal year Fed. budget balance last 12 months ($ billions) Oct 2016 -11.9 -11.3 -10.2 7.3 -9.3 0.6

INFLATION AND COSTSConsumer Prices Dec 2016 -0.2 -0.4 0.2 -0.3 1.2 1.4 1.5 1.4 1.1

- Excluding Food and Energy Dec 2016 -0.4 -0.4 0.2 0.1 1.6 1.9 1.8 1.9 1.8- Core inflation (4) Dec 2016 -0.3 -0.5 0.2 -0.4 1.3 1.9 1.6 1.9 2.2

Average Hourly Earnings (2) Dec 2016 0.3 0.2 0.2 5.2 0.2 2.1 1.6 2.1 2.8Price of New Housing icluding land Nov 2016 0.2 0.4 0.2 3.1 3.5 2.4 3.0 2.5 1.3Avg. Price of Existing Homes Sold (MLS) Nov 2016 2.3 0.2 2.4 4.4 -0.7 11.4 7.5 11.4 7.9Industrial Prices (1992=100) Nov 2016 0.3 0.7 0.4 3.2 2.7 -0.3 1.4 -0.5 -1.0

LABOUR MARKETLabour Force Dec 2016 0.4 -0.1 0.2 2.3 0.7 0.8 0.9 0.8 0.8Job creation (000) Dec 2016 53.7 10.7 43.9 36.1 28.4 17.8 214.1 214.1 155.4

- Manufacturing Dec 2016 3.6 -11.9 -7.5 -5.3 -0.2 -4.4 -53.4 -53.4 37.4- Services Dec 2016 52.0 31.2 23.4 35.5 25.1 23.0 275.8 275.8 172.4- Full Time Dec 2016 81.3 -8.7 -23.2 16.5 8.9 5.0 60.4 60.4 147.4- Part Time Dec 2016 -27.6 19.4 67.1 19.6 19.5 12.8 153.7 153.7 8.0

Unemployment Rate Dec 2016 6.9 6.8 7.0 6.9 6.9 7.0 7.1 7.0 6.9

NATIONAL ACCOUNTS AND OTHER Annualized Growth RatesQUARTERLY INDICATORS Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2015 2014 2013GDP Chained (2007) $ 3.5 -1.3 2.7 0.5 2.3 -0.4 0.9 2.6 2.5Household consumption 2.6 1.8 2.5 1.7 2.7 2.0 1.9 2.8 2.6Business Investments, non-res., mach. & equip. 3.5 -0.9 -8.5 -13.7 -9.1 -15.1 -11.5 3.2 5.6

-Machinery and Equipment -12.2 4.1 -2.2 -10.1 2.2 -10.8 -3.3 1.2 0.6Residential Construction -5.5 0.3 10.2 1.8 2.5 1.2 3.8 2.7 -0.3Government Expenditures -1.2 5.3 3.3 0.0 1.5 0.9 1.5 0.8 -0.7Government Fixed Capital Formation 2.6 -0.9 2.7 -1.1 1.7 -5.5 5.8 -3.6 -7.4Final Domestic Demand 0.9 2.0 1.8 -0.5 0.9 -0.7 0.3 1.9 1.6Exports 8.9 -14.8 9.0 -2.1 5.7 5.2 3.4 5.8 2.7Imports 3.3 1.4 2.3 -6.3 -4.3 -0.4 0.3 0.3 2.2Change in Inventories, chained (2007) $ (5) 4.6 1.0 -8.2 -3.1 -0.9 6.3 3.9 9.4 14.8Real Disposible Income 7.4 3.4 -1.0 4.5 2.0 6.0 3.4 1.2 3.2Personal savings Rate 5.8 4.8 4.5 5.6 4.8 5.3 5.0 3.7 5.0GDP Price Deflator 2.5 1.1 0.0 -1.1 0.7 0.4 -0.8 1.9 1.6Corporate Profits (nominal) 93.1 -34.4 2.6 -27.6 6.4 -18.6 -19.5 8.2 4.0

as a % of GDP 11.2 9.7 10.7 10.7 11.6 11.5 11.5 14.3 13.8Indust. Capacity Utilization Rate 81.9 79.7 81.2 80.6 81.2 80.6 81.1 82.4 81.0Labour Productivity, Business Sector 5.0 -0.9 1.7 0.0 0.7 -3.7 -0.6 2.7 1.5Unit Labour Cost, Business Sector -2.7 3.1 -0.9 3.0 -1.5 3.0 2.6 0.8 1.2

Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2015 2014 2013Current Account (current $) (5) -73.2 -76.1 -68.2 -66.4 -65.3 -65.8 0.0 -67.6 -48.2

as a % of GDP -3.6 -3.8 -3.4 -3.3 -3.3 -3.3 0.0 -3.4 -2.4

Sources: Thomson reuthers Datastream and Canadian Real Estate Association

* Update

(1) Annual Rate (4) C.P.I. excluding the 8 most volatile components and the effect of indirect taxes

(2) Not Seasonally Adjusted (5) Annual rate, $ billions

(3) Current and before taxes (6) Compared to same period of the preceeding year, unless otherwise stated


Monthly Growth (%)

A3



QUEBECDOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 0.3 0.8 1.2 8.2 3.9 4.1 4.5 4.3 0.5Manufacturing Shipments Nov 2016 3.0 -1.5 1.7 4.7 1.8 -1.2 1.9 -1.3 -1.1Housing Starts (000) (2) Dec 2016 41.4 37.5 39.2 39.4 39.4 38.7 41.4 38.7 36.7Number of existing homes sold (MLS) Nov 2016 -4.0 3.2 2.1 9.0 4.0 6.3 3.7 6.0 4.6Wages and Salaries Sept 2016 0.7 1.3 -1.0 3.4 3.7 2.9 3.9 3.3 2.3Value of merchandise exports (1) Nov 2016 10.0 -4.1 11.2 37.7 -0.2 -0.9 11.5 -1.8 7.8CFIB Business Barometer ® * Jan 2017 4.3 3.1 -1.5 2.7 8.2 10.7 12.0 12.0 8.8Number of commercial bankrupties (1) * Sep 2016 3.1 -1.5 2.7 8.2 10.7 12.0 #VALUE! 8.8 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.3 -0.2 0.1 0.0 0.0 0.7 0.6 0.7 1.1Average Hourly Earnings (1) Dec 2016 0.0 1.2 0.0 7.6 2.1 2.8 3.2 2.8 2.1Price of New Housing inc. Land (1) Nov 2016 0.0 0.0 0.3 1.5 0.7 0.7 0.6 0.7 0.1Avg. Price of Existing Homes Sold (MLS) Nov 2016 0.2 -1.0 0.5 4.7 4.6 2.7 2.0 2.9 1.5

LABOR MARKET

Job creation (000) Dec 2016 20.4 8.5 3.2 10.7 14.7 7.5 89.5 89.5 48.6Unemployment rate Dec 2016 6.6 6.2 6.8 6.5 6.8 7.1 7.9 7.1 7.7Participation rate Dec 2016 65.1 64.5 64.8 64.8 64.6 64.6 65.0 64.6 64.8

ONTARIODOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 0.5 1.6 0.9 9.5 3.5 4.9 3.5 4.9 4.2Manufacturing Shipments Nov 2016 0.0 -0.5 0.1 0.9 -1.1 4.0 0.4 4.1 1.6Housing Starts (000) (2) Dec 2016 80.1 59.1 84.8 74.7 74.2 75.1 53.8 75.1 69.0Number of existing homes sold (MLS) Nov 2016 -3.5 0.8 3.4 11.1 9.8 8.9 6.7 8.7 9.4Wages and Salaries Sept 2016 0.2 0.9 -1.0 1.1 3.7 4.3 4.0 4.2 4.1Value of merchandise exports (1) Nov 2016 0.2 1.9 0.1 37.2 -3.3 6.5 3.4 5.6 10.5CFIB Business Barometer ® * Jan 2017 -1.2 3.2 3.1 14.6 2.5 0.3 8.6 8.6 -13.9Number of commercial bankrupties (1) Sep 2016 #REF! #REF! #REF! 2.5 0.3 8.6 #VALUE! -13.9 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.2 -0.3 0.4 0.5 1.6 1.8 2.0 1.8 1.2Average Hourly Earnings (1) Dec 2016 0.2 0.0 0.1 3.7 -0.7 2.2 0.9 2.2 3.1Price of New Housing inc. Land (1) Nov 2016 0.4 1.0 0.3 6.9 7.7 4.6 6.3 4.8 2.4Avg. Price of Existing Homes Sold (MLS) Nov 2016 3.0 0.7 2.2 25.2 20.1 14.2 20.7 14.8 7.4

LABOR MARKET

Job creation (000) Dec 2016 9.1 18.9 25.4 17.8 7.3 6.7 80.6 80.6 84.5

Unemployment rate Dec 2016 6.4 6.3 6.4 6.4 6.5 6.6 6.7 6.6 6.8Participation rate Dec 2016 64.9 64.8 64.8 64.9 64.8 65.0 65.2 65.0 65.2

NEWFOUNDLAND & LABRADORDOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 -0.4 -0.3 1.8 3.2 -0.8 0.9 -1.9 1.0 0.3Manufacturing Shipments Nov 2016 8.3 19.4 -13.0 1.5 1.9 -19.3 6.4 -19.4 -6.4Housing Starts (000) (2) Dec 2016 1.3 1.2 1.5 1.3 1.3 1.5 1.4 1.5 1.8Number of existing homes sold (MLS) Nov 2016 0.6 4.7 -5.6 -14.9 0.3 0.4 1.1 0.3 4.0Wages and Salaries Sept 2016 0.9 -1.5 0.5 -0.9 0.2 0.4 0.0 -0.2 3.4Value of merchandise exports (1) Nov 2016 10.3 32.0 -32.5 -37.5 56.1 -9.6 63.1 -10.0 -31.7CFIB Business Barometer ® * Jan 2017 -3.5 12.7 -4.8 47.8 -18.6 -24.5 -27.2 -27.2 4.8Number of commercial bankrupties (1) Sep 2016 12.7 -4.8 47.8 -18.6 -24.5 -27.2 0.0 4.8 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.1 -0.7 0.3 0.2 5.4 2.7 4.1 2.7 0.4Average Hourly Earnings (1) Dec 2016 1.0 0.7 0.8 17.7 0.7 -0.6 1.3 -0.6 -1.3Price of New Housing inc. Land (1) Nov 2016 0.0 0.0 0.2 0.0 -0.5 0.2 -0.3 0.1 0.3Avg. Price of Existing Homes Sold (MLS) Nov 2016 0.9 3.8 -1.1 4.5 0.3 -6.4 -3.1 -6.8 -2.9

LABOR MARKETJob creation (000) Dec 2016 -1.6 -0.4 -5.6 -2.5 -1.7 -0.5 -5.7 -5.7 -4.8Unemployment Dec 2016 14.9 14.3 14.9 14.7 13.8 13.4 14.4 13.4 12.9Participation rate Dec 2016 60.0 60.0 60.5 60.2 60.3 60.5 61.4 60.5 61.1

PRINCE EDWARD ISLANDDOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 2.1 0.0 4.9 19.6 6.7 6.6 9.1 6.6 1.9Manufacturing Shipments Nov 2016 9.0 1.0 -9.1 -4.5 8.8 3.5 6.0 4.3 7.4Housing Starts (000) (2) Dec 2016 0.3 0.5 0.3 0.4 0.6 0.5 0.2 0.5 0.5Number of existing homes sold (MLS) Nov 2016 5.6 -13.4 -0.5 -9.5 19.4 23.2 11.1 22.3 19.5Wages and Salaries Sept 2016 1.1 0.7 -1.0 1.6 2.4 4.4 2.7 3.9 3.0Value of merchandise exports (1) Nov 2016 -1.5 -0.9 12.4 38.1 32.8 3.1 15.6 2.0 17.1CFIB Business Barometer ® * Jan 2017 2.3 -11.6 8.6 -1.9 -3.8 2.4 7.1 7.1 -13.6Number of commercial bankrupties (1) Sep 2016 11.6 8.6 1.9 3.8 2.4 7.1 #VALUE! 13.6 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.7 -0.1 1.0 2.4 0.9 1.2 1.3 1.2 -0.6Average Hourly Earnings (1) Dec 2016 -1.0 0.6 1.3 10.0 -1.5 1.3 0.0 1.3 2.4Price of New Housing inc. Land (1) Nov 2016 0.0 0.0 0.0 0.0 0.3 0.3 0.9 0.4 0.2Avg. Price of Existing Homes Sold (MLS) Nov 2016 -13.9 13.5 -13.5 -26.2 11.0 8.5 -1.5 9.1 -0.8

LABOR MARKETJob creation (000) Dec 2016 0.6 0.3 -0.2 0.2 0.1 -0.1 -0.7 -0.7 -0.5Unemployment Dec 2016 10.7 10.8 11.7 11.1 11.0 10.8 9.8 10.8 10.4Participation rate Dec 2016 65.9 65.6 66.0 65.8 65.7 65.8 66.5 65.8 67.6

Sources: Thomson Reuthers Datastream and Canadian Real estate Association* Update (1) Not Seasonally Adjusted (2) Annual Rate (3) Compared to sdame priod of the preceeding year, unless otherwise stated

Annex - Economic tablesTABLE 4 - PROVINCIAL ECONOMIC INDICATORS

January 27, 2017Monthly Growth (%)

A4


January 27, 2017 Annualized Growth (%)

Growth Rates Unless Reference Past Prev. Month Average of the last Since Year-to-date (3)Otherwise Indicated Period Month Month Before 3 Mos. 6 Mos. 12 Mos. 12 Mos. ref. prec.

NOVA SCOTIADOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 2.0 0.4 1.4 13.4 4.4 4.1 4.3 4.3 -0.8Manufacturing Shipments Nov 2016 6.7 -1.1 -3.5 1.3 2.1 5.3 7.3 4.5 4.4Housing Starts (000) (2) Dec 2016 3.9 4.8 4.4 4.4 4.1 3.7 1.8 3.7 3.9Number of existing homes sold (MLS) Nov 2016 -9.5 -2.9 4.8 6.3 4.8 4.2 -8.7 5.0 3.6Wages and Salaries Sept 2016 0.4 0.2 -0.7 0.0 0.4 2.1 1.6 1.8 1.9Value of merchandise exports (1) Nov 2016 2.9 5.8 -13.2 -33.9 -4.8 -0.6 -3.4 -2.5 0.1CFIB Business Barometer ® * Jan 2017 0.4 0.1 -1.0 12.1 1.8 -3.6 -5.5 -5.5 6.3Number of commercial bankrupties (1) * Sep 2016 0.1 -1.0 12.1 1.8 -3.6 -5.5 #VALUE! 6.3 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.2 -0.5 0.0 -0.9 0.9 1.2 1.3 1.2 0.4Average Hourly Earnings (1) Dec 2016 -1.0 0.1 1.4 9.7 3.9 3.2 5.2 3.2 0.6Price of New Housing inc. Land (1) Nov 2016 0.2 0.5 0.0 2.0 1.1 0.3 1.3 0.3 0.8Avg. Price of Existing Homes Sold (MLS) Nov 2016 -1.0 -6.0 10.8 23.6 8.7 0.2 1.3 0.2 2.3

LABOR MARKETJob creation (000) Dec 2016 0.5 3.7 0.9 1.7 0.3 0.2 2.6 2.6 -5.2Unemployment Dec 2016 8.3 8.0 7.6 8.0 8.2 8.4 8.6 8.4 8.6Participation rate Dec 2016 61.9 61.7 60.9 61.5 61.5 61.7 62.0 61.7 62.4

NEW BRUNSWICKDOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 0.8 1.6 0.9 8.3 -0.7 3.3 -0.1 3.3 2.3Manufacturing Shipments Nov 2016 -2.4 -1.6 -6.6 -12.9 -3.8 -5.2 10.1 -4.5 -9.8Housing Starts (000) (2) Dec 2016 1.8 2.1 2.3 2.1 2.1 1.9 1.7 1.9 2.0Number of existing homes sold (MLS) Nov 2016 3.0 7.1 -4.5 16.1 19.1 7.6 13.9 6.9 5.7Wages and Salaries Sept 2016 1.5 0.3 -0.4 2.2 3.1 4.1 4.6 3.9 2.5Value of merchandise exports (1) Nov 2016 6.8 -20.6 -23.8 -73.7 -4.7 -12.5 6.3 -13.1 -6.1CFIB Business Barometer ® * Jan 2017 5.2 1.7 5.9 11.6 2.6 -2.3 1.1 1.1 -2.1Number of commercial bankrupties (1) * Sep 2016 1.7 5.9 11.6 2.6 -2.3 1.1 #VALUE! -2.1 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.4 -0.4 0.0 -1.1 2.9 2.2 2.3 2.2 0.5Average Hourly Earnings (1) Dec 2016 -0.4 -0.3 1.3 13.5 5.5 2.1 4.1 2.1 2.9Price of New Housing inc. Land (1) Nov 2016 0.0 0.4 1.2 6.4 1.6 0.6 1.6 0.6 -0.2Avg. Price of Existing Homes Sold (MLS) Nov 2016 -1.8 1.8 -3.1 -4.3 6.3 1.0 2.4 1.1 -1.0

LABOR MARKETJob creation (000) Dec 2016 0.6 0.5 -2.2 -0.4 0.9 0.2 2.1 2.1 1.4Unemployment Dec 2016 9.4 8.7 10.0 9.4 9.4 9.6 8.9 9.6 9.8Participation rate Dec 2016 62.8 62.2 63.0 62.7 62.7 62.4 62.3 62.4 62.7

MANITOBADOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 0.8 0.3 -0.7 2.3 0.3 4.6 2.2 4.7 1.3Manufacturing Shipments Nov 2016 2.8 1.8 -0.7 19.7 -0.2 0.8 1.9 1.1 -1.4Housing Starts (000) (2) Dec 2016 4.3 6.8 5.5 5.5 5.7 5.3 4.9 5.3 5.6Number of existing homes sold (MLS) Nov 2016 -7.9 5.3 0.3 -6.1 -5.1 4.2 -5.1 4.1 1.3Wages and Salaries Sept 2016 1.2 0.5 -0.1 1.9 0.5 2.6 2.3 2.2 3.0Value of merchandise exports (1) Nov 2016 10.8 2.3 2.2 22.5 -13.7 -0.7 4.2 -2.1 1.1CFIB Business Barometer ® * Jan 2017 0.7 5.4 13.7 96.4 12.8 -1.7 9.4 9.4 7.5Number of commercial bankrupties (1) * Sep 2016 5.4 13.7 96.4 12.8 -1.7 9.4 #VALUE! 7.5 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.1 -1.2 0.3 -2.2 1.0 1.3 1.1 1.3 1.2Average Hourly Earnings (1) Dec 2016 0.6 0.2 0.3 5.3 0.0 2.0 1.2 2.0 3.5Price of New Housing inc. Land (1) Nov 2016 0.1 0.6 0.3 3.5 2.5 1.8 2.4 1.8 1.0Avg. Price of Existing Homes Sold (MLS) Nov 2016 2.3 -1.6 2.1 8.4 6.5 2.0 3.4 2.6 1.8

LABOR MARKETJob creation (000) Dec 2016 1.2 -0.9 0.9 0.4 -0.5 -0.1 -1.0 -1.0 -0.8Unemployment Dec 2016 6.3 6.2 6.4 6.3 6.2 6.1 5.9 6.1 5.6Participation rate Dec 2016 67.2 67.1 67.4 67.4 67.4 67.5 68.0 67.5 68.3

SASKATCHEWANDOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 1.6 0.4 0.2 -1.7 0.8 0.8 2.5 1.0 -3.7Manufacturing Shipments Nov 2016 1.3 -0.2 1.5 22.0 8.2 -0.3 12.2 0.0 -11.7Housing Starts (000) (2) Dec 2016 5.3 4.1 4.7 4.7 5.3 4.9 4.9 4.9 5.2Number of existing homes sold (MLS) Nov 2016 -8.6 4.5 -1.7 3.9 -3.7 -5.9 -13.3 -5.7 -11.0Wages and Salaries Sept 2016 0.4 0.1 -0.3 -0.6 -1.1 0.3 0.3 -0.1 2.1Value of merchandise exports (1) Nov 2016 5.2 5.2 31.3 195.6 6.0 -20.1 1.4 -20.1 -6.4CFIB Business Barometer ® * Jan 2017 1.9 5.4 -6.9 -9.0 12.7 -5.0 -6.3 -6.3 6.5Number of commercial bankrupties (1) * Sep 2016 5.4 -6.9 -9.0 12.7 -5.0 -6.3 #VALUE! 6.5 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.2 -0.8 0.2 -1.9 0.2 1.1 0.6 1.1 1.6Average Hourly Earnings (1) Dec 2016 0.9 -0.5 -0.1 7.7 0.8 3.3 2.2 3.3 2.5Price of New Housing inc. Land (1) Nov 2016 -0.1 0.1 0.0 -0.8 -1.6 -1.6 -1.2 -1.6 -0.7Avg. Price of Existing Homes Sold (MLS) Nov 2016 3.8 -4.3 -1.3 -6.0 2.5 -0.8 -0.3 -0.8 -0.6

LABOR MARKETJob creation (000) Dec 2016 -1.1 2.4 -2.4 -0.4 -0.3 -0.6 -6.9 -6.9 0.4Unemployment Dec 2016 6.5 6.8 6.9 6.7 6.6 6.3 5.5 6.3 5.0Participation rate Dec 2016 69.7 70.1 69.9 69.9 69.9 69.9 70.4 69.9 70.1

Sources: Thomson Reuthers Datastream and Canadian Real estate Association* Update (1) Not Seasonally Adjusted (2) Annual Rate (3) Compared to sdame priod of the preceeding year, unless otherwise stated

Annex - Economic tablesTABLE 4 - PROVINCIAL ECONOMIC INDICATORS (Continues from page A4)

Monthly Growth (%)

A5



ALBERTADOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 -0.5 0.9 0.5 3.8 -0.9 -2.3 -2.1 -1.9 -4.4Manufacturing Shipments Nov 2016 3.9 -1.5 -0.4 3.9 8.4 -10.7 0.7 -9.9 -13.6Housing Starts (000) (2) Dec 2016 26.8 25.2 25.6 25.8 25.3 24.6 25.5 24.6 37.5Number of existing homes sold (MLS) Nov 2016 -13.2 6.9 4.1 6.2 12.5 -9.8 -8.9 -9.1 -21.7Wages and Salaries Sept 2016 0.0 -0.8 1.3 1.8 -3.3 -3.8 -2.9 -3.8 0.2Value of merchandise exports (1) Nov 2016 9.4 1.0 -1.8 51.1 23.2 -18.4 13.1 -17.0 -23.3CFIB Business Barometer ® * Jan 2017 8.9 16.4 -10.2 -17.3 62.3 -3.9 63.8 63.8 -47.4Number of commercial bankrupties (1) * Sep 2016 16.4 -10.2 -17.3 62.3 -3.9 63.8 #VALUE! -47.4 #VALUE!PRICESConsumer Price Index (1) Dec 2016 -0.1 -0.6 0.4 -1.1 0.7 1.1 1.0 1.1 1.2Average Hourly Earnings (1) Dec 2016 1.1 0.1 -0.2 2.4 -1.2 1.9 1.7 1.9 3.4Price of New Housing inc. Land (1) Nov 2016 0.2 -0.1 -0.2 -1.1 -1.2 -0.5 -0.8 -0.5 0.8Avg. Price of Existing Homes Sold (MLS) Nov 2016 0.3 -0.9 1.3 1.9 4.0 0.2 2.5 0.3 -2.3

LABOR MARKETJob creation (000) Dec 2016 6.9 -12.8 9.0 1.0 3.0 -1.6 -18.8 -18.8 -19.6Unemployment Dec 2016 8.5 9.0 8.5 8.7 8.6 8.1 7.0 8.1 6.0Participation rate Dec 2016 72.7 72.9 72.9 72.8 72.6 72.5 72.7 72.5 73.0

BRITISH COLUMBIADOMESTIC DEMAND AND REVENUERetail Sales Nov 2016 -0.7 1.6 1.0 8.7 6.8 6.4 5.5 6.5 6.1Manufacturing Shipments Nov 2016 2.4 0.1 -0.5 10.6 10.1 3.2 9.2 3.7 3.1Housing Starts (000) (2) Dec 2016 41.8 46.1 27.4 38.4 40.0 42.1 35.2 42.1 31.5Number of existing homes sold (MLS) Nov 2016 -6.2 1.7 -3.9 -43.5 -33.9 14.4 -19.3 13.1 21.1Wages and Salaries Sept 2016 0.6 0.7 0.3 3.7 4.9 4.2 4.8 4.2 4.0Value of merchandise exports Nov 2016 10.4 3.5 -0.2 50.3 23.2 7.5 25.9 7.6 -0.3CFIB Business Barometer ® * Jan 2017 -6.1 0.7 5.2 20.3 3.2 -2.7 3.8 3.8 -12.4Number of commercial bankrupties (1) * Sep 2016 0.7 5.2 20.3 3.2 -2.7 3.8 #VALUE! -12.4 #VALUE!PRICESConsumer Price Index (1) Dec 2016 0.0 -0.3 -0.1 -1.5 2.1 1.9 1.9 1.9 1.1Average Hourly Earnings (1) Dec 2016 0.2 -0.2 0.2 3.4 0.8 1.1 0.6 1.1 2.9Price of New Housing inc. Land (1) Nov 2016 -0.3 0.3 0.3 2.4 5.4 4.3 4.5 4.5 0.7Avg. Price of Existing Homes Sold (MLS) Nov 2016 2.6 2.0 3.8 -19.4 -21.6 9.7 -5.5 8.9 11.0

LABOR MARKETJob creation (000) Dec 2016 17.0 -9.3 14.9 7.5 4.6 6.0 72.4 72.4 51.5Unemployment Dec 2016 5.8 6.1 6.2 6.0 5.8 6.0 6.7 6.0 6.2Participation rate Dec 2016 64.7 64.5 64.8 64.6 64.4 64.4 64.1 64.4 63.4

Sources: Thomson-Reuthers Datastream, Canadian Real estate Association and BCStats

* Update (1) Not Seasonally Adjusted (2) Annual Rate (3) Compared to sdame priod of the preceeding year, unless otherwise stated

January 27, 2017

Annex - Economic tablesTABLE 4 - PROVINCIAL ECONOMIC INDICATORS (Continues from page A5)

Monthly Growth (%)

A6


TABLE 5 - INTERNATIONAL ECONOMIC INDICATORSJanuary 27, 2017


OECD leading index Nov 2016 0.1 0.1 0.0 0.5 0.0 -0.5 0.0 -0.5 -0.3

JAPANConsumer confidence - percenbtage (1) Dec 2016 42.5 40.5 42.0 41.7 42.0 41.7 41.8 41.7 41.3Retail Sales (1) Nov 2016 1.4 4.7 -2.2 -3.6 -5.4 -0.7 1.7 -0.7 -0.3Industrial Production, Volume Index Nov 2016 1.5 0.0 0.6 7.8 4.2 -1.0 2.9 -0.9 -1.2Exports * Dec 2016 1.8 3.9 2.0 25.5 2.8 -7.8 3.7 -7.8 3.5Imports * Dec 2016 3.9 3.5 -0.2 18.3 -0.5 -15.9 -0.8 -15.9 -8.6Merchandise trade bal. (Billions of ¥) Nov 2016 6,225 5,546 5,350 5,707 5,314 4,108 1,738 48,189 -7,133Current account (Billions of ¥) Nov 2016 180 193 153 175 173 166 155 1,831 1,468Inflation (CPI) * Dec 2016 -0.2 0.3 0.5 2.4 0.2 -0.1 0.3 -0.1 0.8Job offers to applicants ratio Nov 2016 1.41 1.40 1.38 1.40 1.38 1.34 1.26 1.35 1.20Unemployment Rate Nov 2016 3.1 3.0 3.0 3.0 3.1 3.1 3.3 3.1 3.4

Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2015 2014 2013Gross Domestic Product (Constant Yen) 1.3 1.8 2.8 -1.8 0.8 -0.5 1.2 0.2 2.0

Euro-zoneVolume Retail Sales Nov 2016 -0.4 1.4 -0.3 2.1 1.6 2.0 2.2 1.9 2.8Industrial Production exc. Construction Nov 2016 1.5 0.1 -0.8 3.6 1.6 1.3 3.0 1.3 2.1Exports Nov 2016 3.3 -0.2 -0.4 7.8 1.9 0.1 4.0 -0.2 5.0Imports Nov 2016 1.8 2.4 -1.1 8.7 2.8 -1.9 3.5 -2.3 2.3Merch. Trade Bal. (Millions of euros) Nov 2016 22,714 19,884 23,671 22,090 22,135 22,168 21,975 244,477 209,783Inflation (CPI) Dec 2016 0.5 -0.1 0.2 2.7 1.6 0.2 1.1 0.2 0.0Unemployment Rate Nov 2016 9.8 9.8 9.9 9.8 9.9 10.1 10.5 10.1 10.9

Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 Q2 2015 2013 2012 #VALUE!Gross Domestic Product (Constant Euro) * 1.8 1.2 2.0 2.0 1.1 1.5 -0.4 0.0 #VALUE!

UNITED KINGDOMConsumer Confidence (Diffusion index) Dec 2016 -5 -7 -3 -5 -6 -2 4 -2 3Retail Sales Dec 2016 -2.0 -0.1 2.0 5.2 6.1 4.9 4.3 4.9 4.3Manufacturing, energy and mining output Nov 2016 2.0 -1.2 -0.3 -2.3 1.9 0.7 1.9 0.8 1.3Exports (1) Nov 2016 2.8 6.7 -1.4 19.5 10.0 3.5 13.5 3.8 -1.9Imports (1) Nov 2016 8.4 -6.0 0.1 13.3 19.7 3.9 17.4 5.7 -0.7Merchandise Trade Bal. (Millions of £) Nov 2016 -12,163 -9,885 -13,832 -11,960 -12,391 -12,897 -11,923 -123,127 -111,752

Inflation (CPI harmonized) (1) Dec 2016 0.5 0.2 0.0 2.5 2.2 1.3 1.6 1.3 1.1Producer price index, manufacturing (1) Dec 2016 0.1 0.1 0.7 4.0 3.2 0.4 2.7 0.4 -1.7House prices Dec 2016 1.7 0.6 1.5 10.5 3.6 7.7 6.7 7.7 8.9Unemployment Rate (3-month mov. av.) Nov 2016 4.8 4.8 4.8 4.8 4.9 5.0 5.1 4.9 5.5

Q4 2016 Q3 2016 Q2 2016 Q1 2016 Q4 2015 Q3 2015 2016 2015 2014Gross Domestic Product (Constant £) * 2.4 2.3 2.6 1.4 2.8 1.4 2.0 2.2 3.1

INTEREST AND EXCHANGE RATESReference Current Prev. Week Average of last Thurdays 13 w. 26 w. 52 w.Thursday Week Week Before 13 W. 26 W. 52 W. ago ago ago

JAPANPrime Rate * 26 Jan 17 0.30 0.30 0.30 0.30 0.30 0.30 0.30 0.30 0.303-month Financing Bill Rate * 26 Jan 17 -0.27 -0.29 -0.26 -0.34 -0.31 -0.28 -0.26 -0.30 -0.03

- Spread with U.S. * 26 Jan 17 -0.77 -0.80 -0.77 -0.82 -0.70 -0.61 -0.55 -0.55 -0.37Yield on 10-year Gov't Bonds * 26 Jan 17 0.09 0.08 0.05 0.03 -0.01 -0.06 -0.06 -0.28 0.23

- Spread with U.S. * 26 Jan 17 -2.42 -2.38 -2.31 -2.33 -2.02 -1.93 -1.90 -1.79 -1.76Exchange Rate (¥/U.S.$) * 26 Jan 17 114.5 114.9 114.7 113.2 107.4 108.2 105.3 105.3 118.8

Euro Zone3-month Treasury Bills * 26 Jan 17 -0.25 -0.25 -0.25 -0.25 -0.25 -0.24 -0.25 -0.25 -0.17

- Spread with U.S. * 26 Jan 17 -0.75 -0.76 -0.76 -0.73 -0.63 -0.57 -0.54 -0.50 -0.51Yield on 10-year Gov't Bonds * 26 Jan 17 0.00 120.30 119.98 #DIV/0! #DIV/0! #DIV/0! 0.00 0.00 $$ER: E100

- Spread with U.S. * 26 Jan 17 -2.51 117.84 117.62 #DIV/0! #DIV/0! #DIV/0! -1.84 -1.51 #VALUE!Exchange Rate (U.S.$/Euro) * 26 Jan 17 1.07 1.07 1.06 1.06 1.09 1.11 1.09 1.11 1.09

(Yen/Euro) * 26 Jan 17 122.40 122.23 121.69 120.60 117.37 119.84 114.39 116.14 129.62(Euro / £ ) * 26 Jan 17 1.17 1.16 1.15 1.17 1.16 1.21 1.12 1.19 1.31

UNITED KINGDOMPrime Rate #REF! #REF! #REF! #REF! #REF! #REF! #REF! #REF! #REF! #REF!3-month Treasury Bills (tender) * 26 Jan 17 0.16 0.15 0.10 0.11 0.16 0.30 0.17 0.39 0.48

- Spread with U.S. * 26 Jan 17 -0.34 -0.36 -0.41 -0.37 -0.22 -0.03 -0.12 0.14 0.14Yield on 30-year Gov't Bonds * 26 Jan 17 2.11 2.01 1.94 1.99 1.74 1.94 1.84 1.61 2.43

- Spread with U.S. * 26 Jan 17 -0.98 -1.02 -1.02 -1.02 -0.95 -0.67 -0.76 -0.62 -0.36Exchange Rate (U.S.$ / £ ) * 26 Jan 17 1.26 1.23 1.22 1.24 1.26 1.34 1.22 1.32 1.44

STOCK INDICES Monthly Growth (%) Growth Over (%) Since

Past Prev. Month beginning of year

Reference Level Month Month Before 3 Months 6 Months 1 Year ref. prec.

MSCI Eafe * Jan 2017 227 3.1 2.8 -2.9 2.9 4.8 10.0 3.1 -7.3

* Update (1) Not Seasonally Adjusted (2) Compared to same period of the preceeding year, unless otherwise stated Source: Datastream


Monthly Growth (%)

A7


Spot Price Weekly Growth (%) Annualized Growth (%)

Last Prev. Week For the Last Last

Jan 26 Jan 19 Week Week Before 13 W. 26 W. 52 W. Year

INDICES THOMSON-REUTERS

Total 429.8 429.0 0.2 -0.8 0.8 5.1 5.8 16.7 368.2

Energy 452.9 443.6 2.1 -1.9 0.3 31.8 47.1 53.1 295.9Grain 299.6 301.7 -0.7 1.7 0.8 13.8 15.1 3.9 288.4Industrials 409.0 400.2 2.2 -0.9 1.9 73.9 23.7 25.4 326.1Livestock & Meat 339.8 346.1 -1.8 1.2 2.0 118.6 18.9 -8.0 369.4Precious Metals 780.4 778.6 0.2 -0.6 1.2 -11.8 -25.5 12.8 691.8

PRECIOUS METALS

Gold ($/ounce) 1191.55 1203.35 -1.0 -0.3 2.9 -22.3 -21.1 6.5 1119.00(AM fixing London)

Platinum ($/ounce) 981.0 964.0 1.8 -2.6 4.0 9.0 -27.1 11.0 884.0(AM fixing London)

Silver ($/ounce) 0.2 0.2 -0.9 0.4 0.9 -19.3 -31.7 17.3 0.1(Handy & Harman)

Palladium ($/ounce troy) 717.0 751.0 -4.5 -0.9 2.7 82.4 4.3 43.7 499.0

OTHER METALS (LME)

Aluminum ($/tonne) 1,819 1,834 -0.8 2.4 4.8 32.4 29.4 20.0 1,516

Copper ($/tonne) 5,838 5,714 2.2 -1.7 4.6 122.2 42.8 28.6 4,540

Zinc ($/tonne) 2,751 2,753 -0.1 1.6 4.2 86.0 56.0 74.5 1,577

Nickel ($/tonne) 9,353 9,874 -5.3 -3.4 -0.2 -32.8 -22.9 9.3 8,553

Lead ($/tonne) 2,330 2,297 1.4 4.7 7.7 72.5 69.0 39.3 1,672

Uranium (UxC-Ux U308 Spot $/pound) 23.00 22.50 2.2 2.3 8.6 74.9 -15.4 -33.8 34.75

OTHER COMMODITIES

Oil WTI ($/barrel) future 53.78 51.37 4.7 -3.1 -1.4 36.9 70.9 61.9 33.22(NYMEX)

Oil (Spead with WTI $/barrel) 1st future -16.00 -16.00 0.0 0.0 0.0 48.3 19.3 8.5 -14.75(West Canadian select - CME)

Corn (¢/bushel) 3.5 3.5 -0.9 2.3 -1.4 9.8 16.2 -4.2 3.6(Illinois #2)

Soy beans (¢/bushel) 10.2 10.4 -2.1 2.8 2.7 15.0 6.2 17.9 8.6(Illinois #1)

Pork (¢/lb) 123.8 123.8 0.0 4.9 -4.7 -41.4 -18.4 -5.8 131.5

Beef (Cattle feeder index) 132.6 133.3 -0.5 0.9 -1.0 40.4 -11.6 -17.6 161.0(CME)

Soft Wood Pulp (HWWI) 95 95 0.0 -0.8 0.2 -7.6 -6.2 -0.4 95Index 2010 = 100

Natural Gas (mmbtu) 3.42 3.21 6.5 -3.3 0.6 161.3 53.5 61.3 2.12Henry Hub future NYMEX

Lumber 2X4 332 326 2.0 6.8 -3.3 40.2 3.9 37.4 242

Iron ore ($/metric ton) 84 82 2.5 0.0 5.2 208.6 100.3 95.1 43

All prices are in US dollars Source: Thomson Reuthers Datastream

Annex - Economic tablesTABLE 6 - COMMODITY PRICES

January 27, 2017

A8


ECONOMICS AND STRATEGY

Montreal Office 514-879-2529 Stéfane Marion Marc Pinsonneault Kyle Dahms Chief Economist & Strategist Senior Economist Economist [email protected] [email protected] [email protected]

Paul-André Pinsonnault Matthieu Arseneau Senior Fixed Income Economist Senior Economist [email protected] [email protected]

Krishen Rangasamy Angelo Katsoras Senior Economist Geopolitical Analyst [email protected] [email protected]

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