Where is income in Canada? - Sri Tella

November 19, 2020

Fixed income portfolio manager Sri Tella discusses the impact of rising COVID-19 numbers and restrictions, as well as the U.S. election, on Canadian fixed income investors. Sri notes that the vaccine news from Pfizer and Moderna has boosted risk assets. He believes the news has moved up the timeline of things improving from an economic viewpoint, but there are still a lot of unknowns with regard to the vaccine and how the economy will respond. Sri believes the Bank of Canada has done a good job of adjusting the programs it has in place without actually creating any broad market impacts. The Bank has been clear about its rate outlook and has emphasized that rates will stay low for a long period of time. It has justified that position by pointing to weakness in the economy and the unevenness of the recovery: even though we saw good growth in the third quarter, it was coming back from a weak second quarter. According to any economic activity tracking measures, things are starting to slow down again, partly because of the second wave, but also because the easy lift-off from the trough has already happened.

Recorded on November 17, 2020.