Tumbling oil prices put pressure on finance minister to act

With the price of oil hovering around $30 a barrel and dragging the loonie down with it, Finance Minister Bill Morneau is facing increasing pressure to act.

See Full Article

Conservative Finance Critic Lisa Raitt has urged immediate action, rather than waiting for the release of the budget, for which Morneau has not yet publicly set a date.

“The finance minister should be treating it more as a crisis,” Raitt told CTV’s Power Play.

Raitt said the Liberals ought to be “taking a look at whether or not all those spending promises that were made during the campaign are something that should happen now or be parked for a future time.”

“There’s not a lot of tax revenues that are going to be coming in and digging a huge hole right at the beginning of a mandate that is going to make it very difficult to react should something worse happen,” Raitt added.

Raitt said the Liberals have an opportunity for growth that her government did not enjoy when it faced the economic recession in 2009: a growing U.S. economy.

“As an exporting nation with them as our largest partner, I’d be doubling down to ensure that we’re doing the best we can to get our products into that American market,” Raitt said, adding she would focus on agriculture, forestry and “cutting red tape.”

Earlier in the day, Morneau told reporters in Montreal that he continues to view the Liberal campaign platform as the best way to grow the economy.

“We think by lowering taxes for the middle class, by adding the Canada Child Benefit, by investing significantly in infrastructure, that’s the right thing to do,” he said.

Morneau added that the middle class tax cuts that took effect Jan. 1 are already “putting more money in the pockets” of nine million Canadians, who can spend it, stimulating the economy.

The minister would not say whether the Liberals will go deeper into deficit than the $10-billion promised during the election campaign, adding “I have not yet written the budget.”

NDP Finance Critic Guy Caron, meanwhile, told CTV Power Play that he agrees with the Liberals’ plan to invest in infrastructure and tax cuts to stimulate the economy.

However, Caron said the tax cuts should have gone to lower-income Canadians because the upper middle class might not spend the money.

Both the NDP and Conservatives vowed during last year’s election campaign to balance the budget, while the Liberals said “modest deficits” would allow them to invest in projects that grow the economy.

But as Morneau pointed out in a speech Monday, the price of oil has fallen by half since the election campaign, meaning the government is now projecting a $15 billion per year drop in GDP starting this year, compared to what was projected in the last budget.

Carleton University Professor Ian Lee told CTV News Channel that the oversupplied global energy could force the price of oil even lower, to $20 a barrel, if lower-cost producers like Saudi Arabia keep pumping.

"It's a game of global chicken," he said. "We're really waiting to see who is going to blink first."



Advertisements

Latest Economic News

  • Asian shares stumble as European Central Bank rally fades

    Economic CTV News
    KUALA LUMPUR, Malaysia - Asian shares meandered Friday as an overnight rally in U.S. markets helped by the European Central Bank's decision to extend its bond-buying economic stimulus program faded. South Korea's benchmark slipped as lawmakers prepared to vote on whether or not to impeach President Park Geun-hye. Source
  • Sales, profit at Sears in U.S. continue to decline

    Economic CTV News
    HOFFMAN ESTATES, Ill. -- Sears, the one-time standard bearer for U.S. retail, has posted quarterly losses for more than a year now, and sales continue to slide as the company shutters poorly performing stores. The company's cash situation, which has led in the past to clashes with suppliers, is an ongoing concern. Source
  • Stock markets in New York hit new record highs

    Economic CBC News
    Major stock markets in New York closed at record highs Thursday amid a broad rally from banks, materials and technology companies. The Dow Jones industrial average advanced 65.19 points at 19,614.81, while the S&P 500 added 4.84 points at 2,246.19, both hitting all-time highs for a second day in a row. Source
  • BlackBerry launches new security platform to help companies manage connectivity

    Economic CTV News
    WATERLOO, Ont. - BlackBerry revealed its latest security offering on Thursday intended to help companies reliably manage their current and future connectivity needs. The company's new platform, BlackBerry Secure, is designed to help businesses keep tabs on all their devices to transmit sensitive data to keep people, information and goods safe. Source
  • NHL won't change name of Vegas Golden Knights despite trademark denial

    Economic CBC News
    The National Hockey League says it won't change the name or logo of its newest club, despite being denied a trademark by U.S. authorities. Just a couple of weeks after the Vegas Golden Knights revealed their name, logo and team colours, the U.S. Source
  • Coke sets sights on new demographic: foodies

    Economic CTV News
    NEW YORK -- What beverage goes best with lobster rolls, a bagel sandwich stuffed with whitefish, or a bowl of ramen? Coke wants you to think of soda. Coca-Cola is trying to sell more of its flagship beverage by suggesting the cola can accompany a wide range of meals, rather than just the fast food and pizza with which it's a mainstay. Source
  • Overhead bin fees? Yes, with United's new 'basic' fare

    Economic CTV News
    United Airlines is creating some turbulence in the airline industry with changes to its fare structure, including a new “basic economy” fare. The cheap ticket comes with a catch, however: If you want to use the overhead bin, you must pay an extra charge. Source
  • SNC-Lavalin cutting 405 jobs in Canada mainly due to mining weakness

    Economic CBC News
    Engineering giant SNC-Lavalin is cutting another 405 jobs in Canada due to the weakness in the mining sector and ongoing efforts to boost its profit margin. Spokesman Louis-Antoine Paquin says the company will eliminate 186 positions in Montreal, 195 in Ontario and 24 in Saskatoon, says spokesman Louis-Antoine Paquin. Source
  • Public sector workers paid 10.6% more than private sector average: Fraser Institute

    Economic CBC News
    Almost 90 per cent of public sector workers have some sort of pension plan. By constrast, less than a quarter of private sector workers do. (Chris Wattie/Reuters) People who work in the public sector make almost 11 per cent more than their counterparts in the private sector, a new analysis of Statistics Canada data by the Fraser Institute think tank has found. Source
  • Toronto, Hamilton, K-W expected to lead country in 2017 house price gains: Re/Max

    Economic CBC News
    Re/Max sees the average national house price rising by two per cent in 2017, led by big projected gains in real estate prices in the Hamilton, the Greater Toronto Area and Kitchener-Waterloo. In its 2017 housing market outlook, which was released Thursday, Re/Max said it sees house price appreciation in Hamilton leading the country with an 11 per cent gain in average residential home sale prices, followed by eight per cent gains expected for both the GTA and K-W. Source