Connect with us
[the_ad id="89560"]

Automotive

Bank of Canada holds interest rate at 1.75%; keeps eye on oil slump, investment

Published

4 minute read

OTTAWA — The Bank of Canada is leaving its interest rate unchanged and says the timing of future hikes will depend on factors such as how long the oil-price slump lasts, how well business investment picks up its pace and how much room the economy still has left to grow.

The central bank’s move Wednesday maintains its trend-setting rate at 1.75 per cent. The decision follows the quarter-point increase at the bank’s previous policy meeting in October.

Thanks to the strengthened economy, the bank has been on a gradual rate-hiking path for more than a year and has already raised the benchmark five times since the summer of 2017.

The central bank raises the interest rate to prevent inflation from climbing too high. Heading into Wednesday’s announcement, many market watchers had expected governor Stephen Poloz to wait until at least January before his next rate increase.

More hikes are on the way, but the bank said the timing of its next one will hinge on changes in global trade policies as well as how higher interest rates from past increases affect consumption and housing.

The bank also underlined several recent economic developments that it will now take into account.

“The persistence of the oil-price shock, the evolution of business investment and the bank’s assessment of the economy’s capacity will also factor importantly into our decisions about the future stance of monetary policy,” the bank said Wednesday in a statement.

On oil, the central bank blamed the steep slide in prices on the combination of geopolitical developments, uncertainty about the outlook for global growth and the expansion of American shale oil production. The price of western Canadian oil, the bank added, has fallen further than other benchmarks because of transportation constraints that have led to production cuts.

“Activity in Canada’s energy sector will likely be materially weaker than expected,” the statement said.

Recent data, the bank noted, also show the economy has less momentum heading into the final quarter of 2018. It says it’s related to factors such as a drop in business investment that it largely connects to significant uncertainty around trade last summer.

The bank expects corporate investment to improve — outside the energy sector — following last week’s signing of the updated North American trade agreement, new federal tax incentives and ongoing pressure from rising demand.

It will also be watching for positive developments such as more signs the economy can still expand without stoking inflation. The bank pointed to recent downward revisions to gross domestic product data that suggested there’s still some space for non-inflationary growth.

The bank, which tries to keep inflation within its target band of one to three per cent, noted that October’s inflation reading of 2.4 per cent was above its ideal two per cent bull’s-eye. However, due to weaker gasoline prices, it is now predicting inflation to move down in the coming months by more than its previous forecast.

The Bank of Canada has estimated it will no longer need to increase the interest rate once it reaches a level of between 2.5 and 3.5 per cent, but Poloz has said this destination range remains “sufficiently uncertain” and could move up or down.

Andy Blatchford, The Canadian Press





Storytelling is in our DNA. We provide credible, compelling multimedia storytelling and services in English and French to help captivate your digital, broadcast and print audiences. As Canada’s national news agency for 100 years, we give Canadians an unbiased news source, driven by truth, accuracy and timeliness.

Follow Author

Alberta

Your towing rights! AMA unveils measures to help fight predatory towing

Published on

From the Alberta Motor Association

Know Before the Tow: Towing Rights in Alberta

Predatory towing is a growing concern in major cities across the province. The Alberta Motor
Association (AMA), in partnership with the Calgary Police Service and Calgary Fire Department,
wants to ensure Albertans are not only aware of this emerging issue but also know how to stop
it.

Today, AMA launches Know Before the Tow—a new, provincewide awareness campaign that
empowers Albertans with the knowledge needed to stay confident and in control when faced with
a tow scam. The campaign features a list of five key towing rights that every Alberta driver should
know:

1. You have the right to refuse unsolicited towing services.
2. You have the right to choose who tows your vehicle, and where, unless
otherwise directed by police.
3. You have the right to access your vehicle to retrieve personal items during a
storage facility’s business hours.
4. You have the right to ask if the towing company receives a kickback for taking
your vehicle to a particular storage facility or repair shop.
5. You have the right to a quote prior to service, and an itemized invoice prior to
making payment.

“Being in a collision or broken down at the roadside is stressful enough; the last thing any Albertan
needs is high pressure from an unscrupulous tower,” says Jeff Kasbrick, Vice-President,
Advocacy and Operations, AMA. “These towing rights are clear and remind every Albertan that
they’re in the driver’s seat when it comes to who they choose to tow their vehicle.”

Edmonton and Calgary in particular are seeing increasing reports of predatory towing. Unethical
operators will arrive at a collision or breakdown scene uninvited, create a false sense of urgency
to remove the vehicle, and ultimately leave drivers facing huge fees.

Starting today, Albertans can visit ama.ab.ca/KnowBeforeTheTow to download a digital copy of
their towing rights, helping them feel confident if faced with a tow scam. And soon, all AMA centres
will offer free print versions, which are small enough to tuck in a glovebox.

“Alberta’s towing industry is still highly reputable, with the vast majority of operators committed
to fair and professional service. In fact, AMA and our roadside assistance network is proud to
represent 80% of all private-passenger tows in the province, so our members can be confident
that we’ll always protect them—just as we have for nearly 100 years,” says Kasbrick.

“By knowing your rights and choosing trusted providers like AMA, you can avoid unnecessary
stress, costs, and uncertainty. Because the road to recovery after a collision shouldn’t have to
include fighting for your vehicle.”

Sergeant Brad Norman, Calgary Police Service Traffic Section, says law enforcement continues
to work diligently with first responders and community partners like AMA to put the brakes on
predatory towers, who “are showing up at collision sites and pressuring overwhelmed and
frightened victims into paying high towing rates.”

“Our priority is to ensure the safety of collision victims, the public, and first responders at
collision sites. Part of this effort is educating motorists about their rights so that they Know
Before the Tow that they can say no to unsolicited towing services and choose a reputable
tower of their choice instead,” says Norman. “No one deserves to be taken advantage of after
being involved in a collision.”

To learn more, and to view an expanded version of Alberta towing rights, visit
ama.ab.ca/KnowBeforeTheTow

Continue Reading

Automotive

‘A Lot Of Government Coercion’: Study Slams ‘Forced Transition’ To EVs Consumers Don’t Seem To Want

Published on

 

From the Daily Caller News Foundation

By Owen Klinsky

The push for electric vehicle (EV) adoption is largely premised on misleading claims, and could bring enormous costs for U.S. consumers and the economy, a new meta-study shared exclusively with the Daily Caller News Foundation found.

Federal regulators and multinational corporations have attempted to push EVs on the American public in recent years, with the Biden-Harris administration introducing strict tailpipe emissions standards, and major automakers implementing lofty electric production targets. However, widespread EV adoption may not be as feasible as lawmakers and auto executives once claimed, with a new meta-analysis from the Institute for Energy Research (IER) noting EVs can have a variety of drawbacks for consumers when compared to their gas-powered counterparts, including elevated upfront costs, lower resale values, limited driving range and a lack of charging infrastructure.

“We argue the EV transition is going to take a lot of government coercion to make happen,” Kenny Stein, vice president of policy at IER and the study’s lead author, told the DCNF. “It is a very difficult process, and it is not a very desirable process to force.”

When Government Chooses Your Car Study; Institute for Energy Research (IER)

Much of the reason a U.S. EV transition will not occur without government force, according to the study, is cost. The price of an average EV in the first quarter of 2024 was $53,048, compared to just $35,722 for conventional vehicles, according to car shopping guide Edmunds, meaning many EVs continue to be less affordable than their gas-powered counterparts even with the U.S. Treasury Department’s $7,500 tax credit.

The IER study also cites elevated depreciation as a constraint on EV adoption, noting that the average five-year depreciation for an electric car is $43,515 compared to $27,883 for a gas-powered vehicle, according to vehicle valuation company Kelley Blue Book. The rapid depreciation is largely driven by battery replacement costs, which range from $7,000 to as much as $30,000.

In addition to sheer cost, the study found “range anxiety” — the concern among drivers that they will run out of charge before reaching their destination or a charging station — is a major source of consumer reluctance to purchase EVs. While “range anxiety” can be reduced by increasing mileage, expanding an EV’s range requires a larger battery, which in turn drives up vehicle cost and creates a difficult tradeoff for consumers.

A lack of charging infrastructure also contributes to range concerns, and has proven difficult to fix despite ample government funding, the study found. For example, the bipartisan infrastructure bill of 2021 allotted $7.5 billion to subsidize thousands of new EV charging stations, but only seven stations in four states had been built as of April.

The combination of range issues and high costs has helped drive a slackening in EV demand, with EV sales growing 50% in the first half of 2023 and 31% in the first half of 2024, less than the 71% increase in the first half of 2022. Moreover, a June poll from The Associated Press-NORC Center for Public Affairs Research and the University of Chicago’s Energy Policy Institute found 46% of respondents were “unlikely” or “very unlikely” to purchase an EV, while just 21% were “very” or “extremely” likely to make the change.

If thousands of new charging stations are built and demand rises due to the alleviation of range concerns, the transition would create a variety of new infrastructural challenges, namely that it would reduce the reliability of an already constrained U.S. power grid.

“Up until two years ago or so, electricity demand in the United States was flat so nobody worried about running out of electricity. But with the data center boom and AI [artificial intelligence], there’s been a sudden spike in demand for electricity, and demand is expected to continue growing,” Stein told the DCNF. “Now you’re suddenly talking about not having enough electricity to supply everyday use at the same time we are trying to force pre-existing transportation systems to run on electricity. When you combine that EVs are more expensive and less flexible with the possibility we may be running out of electricity to keep homes cool and to operate industrial facilities, the logic of pursuing [the EV transition] gets even worse.”

Electricity demand has grown by 1.3% annually for the past three years — more than double the average growth rate from 2010 to 2019, according to the Federal Reserve Bank of Kansas City. The surge has been driven largely by a boom in artificial intelligence and data centers, with commercial electricity accounting for 60% of growth in total U.S. power demand between 2021 and 2023.

On the supply side, the Biden-Harris Environmental Protection Agency (EPA) has pushed to reshape the power grid by effectively requiring America’s existing coal plants will have to use carbon capture and storage (CCS) technology to control 90% of their carbon emissions by 2032 if they want to stay running past 2039, and certain new natural gas plants will have to cut their emissions by 90% by 2032. The EPA rule “leaves coal-heavy regions, like the one covered by the Midcontinent Independent System Operator, vulnerable to reliability problems in the near future,” Isaac Orr, a policy fellow for the Center of the American Experiment who specializes in grid analysis, previously told the DCNF.

Grid reliability is already wavering, with hundreds of millions of Americans at risk of experiencing power shortages this winter if weather conditions are harsh, according to power grid watchdog the North American Electric Reliability Corporation (NERC).

The IER study also identifies a set of “myths fueling electric vehicle policy,” including that EVs are necessarily better for the environment.

“One of the biggest sources of emissions from vehicles is tire wear, because tires are made primarily from oil, and as your tires roll along the ground, they degrade and release particulates into the air,” Stein told the DCNF. “Electric vehicles are much heavier than gas-powered cars due to their batteries, which requires them to have heavier tires that wear faster, so EVs actually have much higher particulate emissions than comparable internal combustion engine vehicles.”

A 2020 study from environmental engineering consultancy Emissions Analytics found particulate wear emissions were 1,000 times worse than exhaust emissions, with later research conducted by the consulting firm finding a Tesla Model Y produced 26% more tire emissions than a comparable hybrid vehicle.

Additionally, the IER study notes EVs require six times the mineral inputs of conventional cars, which in turn calls for emissions-intensive mining processes that produce toxic waste.

“For average Americans, the tradeoff calculation obviously is not working,” the study’s authors wrote. “This is not due to misinformation; indeed… there is plenty of pro-EV misinformation. It is simply that…there are negative tradeoffs to EVs. In designing policy, these negative factors must be considered rather than simply ignored.”

Continue Reading

Trending

X