Drugstore shelvesTibor Kolley/The Globe and Mail
Stories Report on Business is following today :
Royal Bank raises mortgage rates
Royal Bank of Canada, the country's largest bank, has raised mortgage rates again.
The move, which will result in a 0.25 percentage point increase in the cost of a number of fixed-rate mortgage products that the bank offers, is likely to spark another round of rate hikes among the country's mortgage lenders.
RBC kicked off one series of hikes a little more than two weeks ago, and most experts said that was the start of a steady rise in mortgage rates.
Another drugstore chain cuts back
At that time the cost of a five-year closed rate mortgage from RBC and many of its competitors rose by 0.60 percentage points to 5.85 per cent.
Another drug store chain is ratcheting up the pressure on the Ontario government and its plans to rein in soaring drug costs, warning it will freeze hiring and start charging drug delivery fees because of lost revenues.
The Rexall drug store chain said Tuesday it will impose a hiring freeze at its corporate head office and will begin charging for prescription drug deliveries at its Ontario pharmacies starting next Monday.
Earlier this week, industry leader Shoppers Drug Mart Corp. already cut store hours and streamlined seven of its stores in the London area of southwestern Ontario.
Home buying more stressful for women?
When it comes to buying a home, women and men have one thing in common - both genders agree that owning a home will give them a sense of well-being and security. But that's where the similarities end, according to surveys conducted by Genworth Financial Canada.
The research shows that even women in fairly strong financial positions tend to be more stressed and less confident than men when it comes to home buying. "Women are consistently more worried and anxious about finances and feel they have less understanding about the home buying process than men," Genworth says.
Settlement in cigarette smuggling case
Two cigarette makers reached settlements with Canada Tuesday over their alleged role in smuggling operations that ran so rampant in the 1990s they forced Canadian anti-smoking taxes to be rolled back.
R.J. Reynolds Tobacco Co. will pay $325-million and Japan Tobacco's JTI-MacDonald unit will pay $150-million to settle out of court claims brought by federal and provincial governments.
Under a separate settlement, R.J. Reynold's former Northern Brands unit will pay $75-million.
The deals bring to an end more a decade of litigation over allegations the companies exported Canadian cigarettes to the United States knowing they would actually come back to Canada illegally and not be taxed.
Communications ownership should remain Canadian, CRTC argues
The head of Canada's broadcasting and telecommunications regulator urged lawmakers this morning to keep in place rules banning foreigners from owning majority stakes in, and controlling, the country's telecoms and broadcasting companies.
"The control of the communications sector should stay in Canadian hands," Konrad von Finckenstein, chairman of the Canadian Radio-television and Telecommunications Commission (CRTC), told a parliamentary committee.
"No foreign entity should own more than 49 per cent," he said.
Mr. Von Finckenstein said rules governing ownership of Canada's broadcast and telecoms sectors should be simplified, and he suggested a single set of regulations be drafted to cover both sectors, given the convergence between technologies.
The parliamentary hearings come after the Conservative government said in early March that it wants to raise the 20 per cent investment limit on foreign ownership of Canadian telecom companies to make the industry more competitive, create jobs and boost innovation.
Executives from Canada's major telecom companies, including Bell, Shaw and Rogers, are set to testify later this week.
If it ain't broke...
Canada should consider an "incrementalist" approach to pension reform that would give the private sector another 10 years to improve retirement options for Canadians before deciding whether a government-led solution like a new national pension scheme is needed, Alberta Finance Minister Ted Morton said Tuesday.
Speaking to a Calgary conference on pension reform, Mr. Morton also said he did not think he could sell the idea of an expanded Canada Pension Plan to Albertans because the existing scheme already disadvantages the province because residents pay more into it than they ultimately receive in benefits, The Globe's Janet McFarland writes.
"I'm not taking an official position on this, but I would suggest it would be a very hard sell in this province and I probably would not be the right person to sell it," he said.
He added there is no urgent need for changes to the retirement system in Canada because it is "not broken" and it already works well for many people.
In comments yesterday in a keynote address at the Calgary conference, Mr. Flaherty said he has not closed the door on any reform option.
But he praised suggestions for a private-sector solution, saying Canada's financial companies are already doing a good job on pension administration "and we need to be mindful of their success in that area."
Mr. Flaherty said the key to reform will be to "tread carefully" and "do no harm" and said he believes such a complex issue will require more months of study before any decisions can be made.
Markets still wary on Greece
The euphoria over the Greece support package is fading fast, signalling there's no easy road ahead for both its embattled government and the larger euro zone. The euro rose today and then quickly slipped again after Greece sold €1.56-billion of 6- and 12-month Treasury bills. The sale was met with strong demand after a weekend commitment by the 16 countries that share the euro to backstop Greece to the tune of €30-billion if needed. But the yields were far higher than earlier issues as investors demanded a hefty return that the country can ill afford.
"The result confirms that the package which was put in place on Sunday has enabled Greece to fund itself in the near- term," David Owen, chief European financial economist at Jefferies International Ltd. in London, told Bloomberg News. "But the longer-term fundamental issues in terms of where we go from here haven't changed. Greece has to put its finances in order against the backdrop of an economy that currently is shrinking."
Added Audrey Childe-Freeman, currency analyst at Brown Brothers Harriman, in an interview with Reuters: "The higher yield confirmed the high risk premium demanded for Greek assets and that has put the euro bears in a stronger position."
Still, noted Scotia Capital economists Derek Holt and Karen Cordes Woods, "the yields are hundreds of basis points above where they were earlier in the year, but the enormous spread between the bid and offer amounts for an offering that itself was expanded from initial plans reflects an enormous confidence boost from the weekend support package offered to the country. There are no guarantees on such aid offers, but the message we've been driving home throughout the Greek debt crisis is that the euro zone will band together."
Related: IMF'S Greek bailout plan signals new world disorder
Canadian exports defy high dollar
Canadian exports pushed ahead in February - in both price and volume - continuing to defy the strong dollar. Exports of industrial goods and materials drove overall exports up by 2.8 per cent, Statistics Canada said today, boosting the country's trade surplus to $1.4-billion from $754-million in January. Imports also rose, but just by 1 per cent, and import prices dipped by 0.2 per cent. "This represented the fifth increase in export volumes and prices in six months," the federal statistics gathering agency said. "... Import volumes have been trending upward since April 2009, whereas prices have generally declined during the same period."
The rebound in exports after the collapse in global trade during the recession is key to Canada's recovery, particularly given the rise in the Canadian dollar , which affects export-sensitive industries. Today's report "suggests that the Canadian external sector continues to defy the drag coming from the very strong Canadian dollar, though we suspect that over the coming months the weight of the strong dollar may begin to wear on exports," said TD Securities senior Canada macro strategist Millan Mulraine. Read the story
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Oil over $80 could threaten recovery
The International Energy Agency warns today that current oil prices threaten the global economic recovery amid fears that crude markets are overheating. Oil has hovered at about $85 (U.S.) a barrel and, the arm of the OECD says in its monthly report, sustained prices over the $80 level are a worry.
"Ultimately, things might turn messy for producers if $80-100 (per barrel) is merely seen as the new $60-80 (per barrel), stunting economic recovery while prompting resurgent non-oil and non-OPEC supply investment," the IEA said, according to The Associated Press. It added that consumer subsidies and tighter credit conditions in countries such as China and India "could stall OECD economic recovery or render it more oil-less than we currently envisage." Read the story
Related: China's big move into Alberta
China reiterates it will stick to policy guns
China's president told the United States again today, in blunt fashion, that it would follow its own path to currency reform, regardless of pressure from other countries. Markets still expect, however, that Beijing will allow the yuan, or renminbi, to soon appreciate. According to remarks released by Chinese officials, Mr. Hu told President Barack Obama that "detailed measures for reform would be considered in the context of the world's economic situation, its development and changes as well as China's economic conditions. It won't be advanced by any foreign pressure."
Scotia Capital currency strategist Sacha Tihanyi noted the timeliness of the meeting given that China has just posted a rare monthly trade deficit, which he said gave the Chinese leader the ammunition to reiterate Beijing's line. "This does nothing to ease the greatly building speculation in the market, however, that the Chinese will begin to allow the renminbi to once again appreciate within the coming months," he said. "A Chinese appreciation is good for China and good for the global economy in the long run, given that it would contribute towards eliminating an artificially large trade surplus that has in the past had an impact on global financial conditions." Read the story
Twitter to unveil ad model
Twitter is poised to roll out a new business model today that would see the hugely popular microblogging service draw advertising revenue, reports say. Twitter has so far been slow to make money from its tremendous growth since it launched three years ago, The New York Times reported, and today's move will illustrate just how the service will monetize that. Ads that Twitter labels "promoted tweets" will appear when users search keywords purchased by advertisers to link to ads. Down the road, the newspaper said, it will show "promoted posts" in the stream of postings. Best Buy, Virgin America and Starbucks plan to run advertising, The Times said. "When people are searching on Starbucks, what we really want to show them is that something is happening at Starbucks right now, and promoted tweets will give us a chance to do that," Chris Bruzzo, vice-president of brand, content and online at Starbucks, told the newspaper. Read the story
From today's Report on Business
Amazon given green light to set up shop in Canada
You've heard of peak oil. How about peak gold?
Reports of TV's death greatly exaggerated