By Ketki Saxena
Investing.com -- The Canadian index traded modestly higher at midday, tracking Wall Street higher as US jobless claims were in line with expectations. The data showed indicators of a weakening labour market, somewhat tempering fears of Fed aggressiveness after resolutely positive economic data in previous data.
The commodity heavy Canadian index was also supported by a rally in oil prices, following optimism of a boost in Chinese demand from China, and signs G7 price cap is delaying exports of Russian crude.
Crude also received a boost from news of a shutdown of TC Energy’s giant behemoth Keystone pipeline following a leak. The 622,000 barrel-per-day Keystone line is the primary artery shipping heavy Canadian crude from Alberta to refiners in the U.S. Midwest and the Gulf Coast.
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Following the Bank of Canada’s 50 bps increase to its overnight rate, taking the rate to 4.25%, Canada’s big six banks have announced an increase to prime rates. RBC (TSX:RY), Bank of Montreal (TSX:BMO), Canadian Imperial Bank of Commerce, Bank of Nova Scotia (TSX:BNS) and Toronto Dominion Bank (TSX:TD) will raise their prime rates by half a percentage point to 6.45%, from 5.95%, effective today.
Also related to Canada’s big banks, the country’s banking regulator has raised Canada’s banking regulator has raised the Domestic Stability Buffer, or DSB, a capital buffer that it requires the country’s largest banks to hold as a buffer against economic shocks. The DSB will be increased to 3% as of Feb. 1, 2023, up from the current level of 2.5%.
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Deputy Governor Sharon Kozicki of the Bank of Canada will speak before the Institut de développement urbain du Québec. Webcasts of the event will be available.