It was a busy week full of important economic readings, corporate news and earnings releases. In the U.S., inflation numbers released Tuesday showed the Consumer Price Index jumping sharply from 1.7% YoY in February to 2.6% YoY in March. Price pressures have been front and centre as a rise in inflation maybe a troubling side effect of an expected surge in economic growth. Even with the yoy increase, many observers – including the Fed – believe a long-lasting rise in inflation remains theoretical and any spikes transitory as stimulus measures wane in the coming months. Retail sales similarly surged in March, up 9.8%, on the backs of stimulus money, vaccinations and business re-openings. There was also good news on the jobs front as fewer people applied for first-time unemployment benefits in the week ended April 10, a decrease from the prior week. Also in the U.S., Q1 earnings season got underway this week with many of America’s blue-chip companies already reporting strong earnings and outlooks for the year. Across the Atlantic, European Parliament trade committees gave the go-ahead Thursday in favour of a post-Brexit trade and cooperation deal with the U.K. The full EU parliament must ratify the agreement later this month otherwise Britain and the EU would trade under WTO terms with tariffs and quotas. In Canada, business sentiment rose to record levels at the start of 2021 on an improving economic outlook according to the BoC’s survey of executives. The survey showed sentiment rose to 2.9 in Q1, the highest since 2018 and the third highest since 2003. Also in Canada, last Friday’s jobs report blew past expectations for a second month. The economy has now recovered all but 296,000 of the 3 million jobs lost during the pandemic. The unemployment rate now stands at 7.5%. In corporate news, Air Canada announced a deal with the federal government Monday that includes up to $5.4 billion in repayable loans and an equity stake for Ottawa. On Friday, China releases GDP numbers for Q1 with growth expectations soaring from last-year’s pandemic-induced downturn.
source https://richarddri.ca/q1-earnings-season-is-starting-off-on-the-right-foot/
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