As investors continued to pile into Corporate bonds in late-2023 and early-2024, the resulting tighter credit spreads has lowered the hurdle for Government bonds to outperform moving forward, especially in a falling rate environment. Tighter credit spreads are vulnerable to an outlook that is anything but perfect at a time when defaults for weaker firms are climbing and developers are under pressure, this leaves little room for error. Despite the optimistic outlook on interest rates, we will continue to adjust portfolios away from expensive risk and toward cheaper quality.
Davos 2024: A year of creative destruction, or just destruction?
Davos 2024 presented a mix of hope and concern, with markets reaching highs and democratic elections on the rise. Economic growth expectations are modest, with global uncertainties, U.S. debt, China's challenges, and trade disruptions on the radar. Creative destruction is marked by disruptive innovation where large firms face hurdles initially, but small teams tend to drive impactful, rapid change.
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Interest rate cuts are coming, but the Bank of Canada won't say when
The Bank of Canada (BoC) maintains a 5% interest rate, citing a slowing economy and persistently high inflation. While mortgage-holders find predictability, the BoC hints at a potential 100 basis points cut later in the year. Predictions suggest rate cuts starting in summer, with caution from the BoC to avoid precise timing due to concerns about inflation and interest rate missteps.
Canadian health care workers turn to AI for help amid a staffing crisis
Canadian health care workers at St. Michael's Hospital use AI tools, like CHARTWatch, to enhance patient care. AI-powered early-warning systems lead to a 26% reduction in the relative risk of death among non-palliative patients. Challenges in AI implementation include privacy concerns and the need for computing power, but institutions like St. Michael's explore AI solutions to address staffing challenges.
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