Lately, the whole world seems to be sinking with even the emerging markets decelerating.
But in his latest note to clients, Gluskin Sheff economist David Rosenberg’s reminds us that at least one economy seems to be holding up:
The softer tone to the U.S. dollar today (and in recent days) and heightened geopolitical concerns in the Middle continues to put a bid into the oil price which has made a fresh three-month high in the wee hours. Copper is rebounding as well. This is supporting the Canadian dollar, which received a little bit of negative press this morning in the NYT (Canadian Dollar’s Strength a Factor in Autoworkers’ Contract Talks on page B1… the loonie at the current time seems overvalued by a few pennies to be sure; though we do remain long-term bulls). And if there is a country out there that does appear to have “decoupled” and we have discussed this before, it is Mexico, where industrial production managed to turn in a hefty 1.3% gain in June, the best performance since September of last year and higher than market expectations. Fiesta yes; siesta no.