Dear valued client,
Canadian markets took a slight hit this week (-0.65%) in light of a 0.25% interest rate increase by the Bank of Canada on Wednesday. The increase comes in response to stubborn inflation and a surprisingly resilient economy. The overnight lending rate is now at 4.75%, its highest level since 2001. My guess is that interest rates will be kept around the 2-4% range for the next decade or so, giving the central bank maneuvering room to better deal with future economic difficulties.
Ukraine is accusing Russia of a “terrorist attack” as an explosion blew a large hole in a dam and hydroelectric plant on the Dnipro River. The damaged dam resulted in the country’s largest river flooding dozens of downstream communities. Thousands of people have been evacuated. Many fear the flooding could jeopardize the water supply to Ukrainian agricultural lands. Wheat, one of the country’s main exports, traded almost 4% higher this week on the Chicago Mercantile Exchange as scarcity fears reached international markets.
The raging wildfires in Quebec and Ontario that blanketed NYC on Wednesday headed south to suffocate Philadelphia, Baltimore, and Washington DC. The smoke is causing historically poor air quality levels that are equivalent to living in a house with a chain smoker. Because of the toxic air about 600 flights were delayed due to poor visibility at LaGuardia, Newark, and Philadelphia International airports on Wednesday and Thursday. As a result, the U.S. has sent hundreds of firefighters to help extenuate the wildfire fiasco. Likewise, meteorologists have predicted that by this weekend, changing wind patterns will bring relief to all wildfire-smogged states.
“There’s no harm in hoping for the best, as long as you’re prepared for the worst.” – Stephen King
Have a terrific weekend,
PW
