The Latest Economic News from Canada

The Latest Economic News from Canada

Canada is a highly developed country in North America, which is the second largest in the world after Russia. It influences global political and economic events, so it is especially interesting to follow the news from Canada. Today, we will review the latest economic news from Canada.

Costco launches fast-food delivery service across Canada

This has become possible through a new partnership with Instacart.

Costco and Instacart is an app that allows users to choose the grocery store and products they would like to receive – announced a partnership after a successful two-month pilot in separate warehouses in Ontario.

Instacart is committed to delivering a wide range of Costco products, including food and household items, baby products and even animals. As a rule, delivery takes no more than 2 hours.

Fast delivery, that is, delivery on the same day, is available to absolutely all Costco customers using the Instacart app. A dedicated Instacart employee will select and deliver the order on time.

More than 70% of Canadian households and 85% of US households can use food delivery services.

Instacart has partnered with over 400 national, regional and local retailers to provide grocery delivery services from over 30,000 stores in 5,500 cities in North America.

Until 2021, most telecommuting employees working from home in TD and RBC will not return to offices

Royal Bank of Canada and TD Bank Group say most of their employees will be working from home until at least next year. This should reduce the risks of further spread of COVID-19.

In a memo sent to bank employees, RBC’s HR manager Helena Gottschling said most employees will work from home until at least 2021.

Gottschling says very few employees in the Greater Toronto area will be able to return to the office. This may happen before the end of September.

The bank intends to warn employees who will be returned to the office at least four weeks in advance and to respond to needs as flexibly as possible.

TD says that homeworkers have also been told that they will not return to the office until the end of the calendar year.

The tallest skyscraper in Canada will be built in Toronto

The Swiss firm Herzog & de Meuron and the Canadian studio Quadrangle have presented a project for the construction of an ultra-thin skyscraper in Toronto.

The 87-story building, called 1200 Bay Street, is proposed to be built in the Yorkville area. If completed, Canada will have a new tallest skyscraper, taking that title away from the 306-meter Foster + Partners building already under construction in the city.

Based on project images, the interior design will include wooden roller blinds and large ceiling-to-floor windows. The blinds can be used to regulate daylight and heat.

The first 16 floors will include retail and office space, while a level with various amenities will separate them from the living areas above. The building is planned to have 332 apartments – from one-room apartments to multi-story penthouses, which will be located on 64 floors. The upper three floors will have a restaurant and a lobby.

Meanwhile, the construction of the tallest skyscraper in Montreal has already begun. It will have 61 floors.

Housing affordability index rises again in Quebec

In June 2020, the Housing Affordability Index in our province was 104.7 points, which is 10.7% more than in June 2019.

As in May, the improvement in the Index was due to a noticeable increase in the average weekly wages and a slight decrease in interest rates. Median wages are expected to grow more slowly over the next few months as many companies are struggling financially.

The rise in wages is partly due to the fact that in the laid-off jobs people often earned less than average. As the labor market recovers, things should get back on track.

A slight decrease in interest rates on 5-year mortgages also helped improve the Housing Affordability Index. However, for many families, housing has become less affordable since they lost their jobs during the pandemic.

Labor market problems have little to no impact on the index in the short term, as job losses do not reduce average weekly wages. Therefore, the growth of the index should be interpreted with caution, given the current circumstances.

As a reminder, the Housing Affordability Index is calculated based on the ratio of the average weekly wage (Statistics Canada) and the “typical” mortgage payment to the base index of 100 (January 2010 = 100).

Airlines are unlikely to be able to restore the pre-crisis level of traffic until 2024

According to new forecasts, the recovery process will be completed one year later.

The International Air Transport Association (IATA) predicts that air travel may return to pre-COVID-19 levels in 2024.

By the end of 2020, global passenger traffic is expected to decline by 55% compared to 2019.

At the same time, it is expected that the recovery of short-haul traffic volumes will be faster than long-haul ones.

According to new forecasts, the recovery process will be completed one year later than previously predicted.

Compared to 2019, the volume of air traffic decreased by 86.5%. According to IATA, the industry has only improved slightly. In May, air traffic decreased by 91%.

A recent survey found that 55% of respondents do not plan to travel at all in 2020.

The federal government calls for 25% reduction in wireless service plan costs

The federal government is monitoring the cost of wireless service plans across the country, urging operators to cut rates by 25% over the next 2 years.

Today, they published the first data on tariff plans from 2 GB to 6 GB, for the period from February to June 2020, as well as plans to continue monitoring prices and regularly update tariff plans.

All Bell, TELUS and Rogers brands are expected to cut prices in the next 2 years. Otherwise, the federal government will introduce regulatory mechanisms to increase market competition and facilitate tariff reduction.

In Quebec, the cost of 2GB and 4GB plans has already dropped below benchmark prices since January 2020. In the rest of the country, they remain unchanged.

The housing market in Quebec continues to favor sellers

The Quebec real estate market today is not at all favorable to buyers who are faced with an extremely limited supply. As a consequence, despite the pandemic, the cost continues to rise.

A recent study of house prices by Royal LePage confirmed that the downtime has sparked a huge demand for home purchases that have exceeded all forecasts. As a result, prices increased in the second quarter of 2020 from April 1 to June 30 in all segments of the Greater Montreal market.

Housing prices on an annualized basis increased by 7.7%.

The reality of buyers today is as follows: you find a house or apartment that you like, and several other offers come in at the same time. Everything is resolved very quickly, and the house often goes above the asking price.

Most likely, the situation should not change much in the near future, despite the economic uncertainty. This is primarily due to the extremely low supply and high demand for housing.

Canadian authorities will allocate $625 million to care for children whose parents return to work

Funding is allocated to provinces and territories based on the existing formula for allocating funds.

Minister of Family, Children and Social Development Ahmed Hussen has announced a $625 million allocation in federal support for the country’s childcare sector. This should help the parents get back to work.

On Friday, the federal government said it is working with provinces and territories to ensure that all Canadian families have access to affordable, high-quality childcare.

The money will be in addition to the $1.2 billion that provinces and territories should receive over 3 years, starting in 2017-2018, according to the authorities. These funds were planned to be spent on supporting early education and childcare institutions and creating up to 40,000 more accessible places in institutions of this kind.

The Federal Center expects that the Safe Restart Agreement will serve as a legal basis for the allocation of additional funds, which will help resolve key issues of a safe resumption of the Canadian economy over the next 6-8 months.

Funding is allocated to provinces and territories based on the existing funding allocation formula used in the framework of bilateral agreements on early education and child care – Early Learning and Child Care Bilateral Agreements.