Analyst perspectives: Banks and the consumer – Brendan Cochrane and Thomas Goldthorpe

How’s the state of the Canadian consumer? Is the Bank of Canada on the right pace in terms of rate cuts? And what does Canada’s recent unemployment rate mean for the broader economy? Joining us to discuss this and more are research analysts Thomas Goldthorpe and Brendan Cochrane. Brendan discusses the recent 25 basis point cut by the BOC saying the consumer would have probably benefited more from a bigger cut. He says with the refinancing of mortgages, this recent cut still affects the consumer’s discretionary spending. But Brendan adds they are still bearish on the Canadian consumer and there are still great opportunities in the Canadian consumer discretionary sector. Thomas says there may be more cuts are on the way, but it will take some time for the cuts to be fully made. Inflation is at 2.5 percent, down from where we were before, but he says it feels like we’re trending towards an inflation regime that could look something like pre-COVID days. They also touch on luxury consumer goods, on-going discussion on a soft landing vs. a hard landing, and the Canadian banking sector. 

 

Recorded on September 6, 2024.

 

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