JFL

Oct. 25, 2017

Investment Outlook Q3 2017

Economic Review

  • The Bank of Canada raised the overnight interest rate twice to 1.0% during the quarter.

  • Economic growth continues to support financial markets with the synchronized global expansion still intact.

  • The improved pace of growth helped corporate bonds outperform government counterparts. Equity markets continued to move upward with support from earnings growth.

Investment Outlook

  • We anticipate the Bank of Canada will be very cautious in raising interest rates as it is cognizant of the risk that record high household debt levels pose on consumer spending.

  • Proposed tax reform in the U.S. would dramatically narrow the current tax advantage of Canadian corporations increasing

  • Economic momentum is still positive which should lead to further gains in stocks.

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