FN: Swooning commodities a threat to Canada’s economic recovery
As commodity prices tumbled Tuesday, stirring up market strife for Canada’s main stock exchange, prices look set to continue their decline and threaten the economic recovery, says David Madani, Canada economist with Capital Economics.
He said in a research note Tuesday that since peaking in April, the Bank of Canada’s composite commodity price index has fallen 13% and could fall further.
“Although the Canadian dollar has also fallen sharply and long-term interest rates have declined, the net effect is likely to be negative for Canadian incomes and domestic demand growth,” Mr. Madani said.
