Canadian home sales surge to record high in July, real estate group says - Reuters

By Fergal Smith

TORONTO, Aug 17 (Reuters) - Canadian home sales rose 26% in July from June, posting the highest monthly level ever recorded, the Canadian Real Estate Association (CREA) said on Monday, as pent-up demand following lockdowns continued to fuel the market.

It was the third straight month of sharply higher sales after a record decline in April, when businesses were closed to help contain the coronavirus pandemic.

"A big part of what we're seeing right now is the snap back in activity that would have otherwise happened earlier this year," said Shaun Cathcart, CREA's senior economist. "Recall that before the lockdowns, we were heading into the tightest spring market in almost 20 years."

Among Canada's largest markets, sales rose 49.5% in the Greater Toronto Area and were up 43.9% in Greater Vancouver, the industry group said.

Actual sales, not seasonally adjusted, rose 30.5% from a year earlier, while the group's Home Price Index was up 7.4% from July last year.

With the rebound in sales activity outpacing the recovery in new supply, the national sales-to-new listings ratio rose to one of the highest levels on record at 73.9% from 63.1% in June, CREA said.

"With many markets extremely tight and the pandemic making a mockery of typical sales patterns, August is already shaping up to be another hot month," said Brian DePratto, a senior economist at TD Bank.

Foreigners sell C$13.52 bln in Canadian securities in June - Reuters News

Aug 17 (Reuters) - Foreign investors sold a net C$13.52 billion ($10.22 billion) in Canadian securities in June, led by both provincial and federal government bonds, following a revised C$22.39 billion total purchase in May, Statistics Canada said on Monday.

Canadian investors bought a net C$10.60 billion worth of foreign securities, led by U.S. shares.

Net foreign investment in Canadian securities (blns of Canadian dollars)

                             Jun     May(rev)    May(prev)

Total                   -13.521     +22.392      +22.406

Bonds                    -5.811     +24.980      +24.993

Stocks                   -5.703      -9.950       -9.950

Money markets            -2.007      +7.363       +7.363

Net Canadian investment in foreign securities (blns of Canadian dollars)

                            Jun      May(rev)    May(prev)

Total                  +10.598      +13.521      +13.371

Bonds                   +0.631       +2.848       +2.821

Stocks                 +10.968       +9.850       +9.725

Money markets           -1.001       +0.824       +0.824

NY Fed Empire State business conditions index 3.7 in Aug vs July's 17.2, forecast 15.0 - Reuters

Aug 17 (Reuters) -

NY FED'S EMPIRE STATE CURRENT BUSINESS CONDITIONS INDEX 3.7 IN AUGUST (CONSENSUS 15) VERSUS 17.2 IN JULY

NY FED'S EMPIRE STATE NEW ORDERS INDEX -1.7 IN AUGUST VERSUS 13.9 IN JULY

NY FED'S EMPIRE STATE EMPLOYMENT INDEX AT 2.4 IN AUGUST VERSUS 0.4 IN JULY

NY FED'S EMPIRE STATE SIX-MONTH BUSINESS CONDITIONS INDEX 34.3 IN AUGUST VERSUS 38.4 IN JULY

NY FED'S EMPIRE STATE PRICES PAID INDEX 16.0 IN AUGUST VERSUS 14.9 IN JULY

Japan's record economic plunge wipes out Abe era gains - Reuters News

Q2 GDP falls annualised 27.8% vs -27.2% in Reuters Poll

Economy suffers 3rd straight quarter of contraction

Private consumption falls 8.2% vs -7.1% in Reuters Poll

Capex falls 1.5% vs -4.2% in Reuters Poll

By Leika Kihara and Tetsushi Kajimoto

TOKYO, Aug 17 (Reuters) - Japan was hit by its biggest economic slump on record in the second quarter as the coronavirus pandemic emptied shopping malls and crushed demand for cars and other exports, bolstering the case for bolder policy action to prevent a deeper recession.

The third straight quarter of declines knocked the size of real gross domestic product (GDP) to decade-low levels, wiping out the benefits brought by Prime Minister Shinzo Abe's "Abenomics" stimulus policies deployed in late 2012.

While the economy is emerging from the doldrums after lockdowns were lifted in late May, many analysts expect any rebound in the current quarter to be modest as a renewed rise in infections keep consumers' purse-strings tight.

"The big decline can be explained by the decrease in consumption and exports," said Takeshi Minami, chief economist at Norinchukin Research Institute.

"I expect growth to turn positive in the July-September quarter. But globally, the rebound is sluggish everywhere except for China."

The world's third-largest economy shrank an annualised 27.8% in April-June, government data showed on Monday, marking the biggest decline since comparable data became available in 1980 and slightly off a 27.2% fall forecast in a Reuters poll of analysts. (Full Story)

While the contraction was smaller than a 32.9% decrease in the United States, it was much bigger than a 17.8% fall in Japan in the first quarter of 2009, when the Lehman Brothers collapse jolted global financial markets.

The size of Japan's real GDP shrank to 485 trillion yen, the lowest since April-June 2011, when Japan was still suffering from two decades of deflation and economic stagnation.

Japanese stocks fell on Monday by the most in two weeks and yields on most government bonds fell on the weak GDP data.

Elsewhere in the region, Thailand reported its biggest economic decline since the Asian financial crisis of 1998. (Full Story)

(Click here for an interactive graphic of real and nominal GDP since 2011: https://tmsnrt.rs/2Fwq2JK)
http://fingfx.thomsonreuters.com/gfx/editorcharts/yzdpxnmewpx/eikon.png

CONSUMPTION PLUNGES

Underlying Japan's dismal reading was private consumption, which plunged a record 8.2% as lock-down measures to prevent the spread of the virus kept consumers at home.

External demand - or exports minus imports - shaved a record 3.0 percentage point off GDP, as overseas shipments tumbled 18.5%, with auto exports hit particularly hard.

Falling global vehicle sales have hurt automakers like Mazda Motor Corp 7261.T and Nissan Motor Co 7201.T, among the biggest drivers of Japan's economy. (Full Story)

Capital expenditure declined 1.5% in the second quarter, less than a forecast 4.2% fall, as solid software investment made up for weak spending in other sectors.

Economy Minister Yasutoshi Nishimura conceded the GDP readings were "pretty severe," but pointed to some bright spots such as a recent pickup in consumption.

However, some analysts warn that companies could cut jobs and spending if a resurgence in infections and soft global demand continue to hurt their bottom line.

Renewed U.S.-China tensions may also weigh on the fragile recovery. About 90% of economists surveyed by Reuters expect the conflict to affect Japan's economy. (Full Story)

"Demand for business investment is expected to fall due to worsening corporate profits and risk of the coronavirus spreading," said Saisuke Sakai, senior economist at Mizuho Research institute.

"There is a chance economic activity may stagnate if major nations adopt lockdown measures again, or Japan re-issues a state of emergency," he said.

Japan has deployed massive fiscal and monetary stimulus to cushion the blow from the pandemic, which hit an economy already reeling from last year's sales tax hike and the U.S.-China trade war.

While the economy has re-opened after the government lifted state of emergency measures in late May, a recent worrying rise in infections cloud the outlook.