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(June 21, 2006) The governor of the Bank of Canada has a message for investors fretting over recent inflation data: Relax. According to David Dodge, the economy is developing as expected and recent upward blips in consumer prices have already been accounted for, although he admits there are forces at play beyond our borders.

“Powerful global economic forces have been affecting the Canadian economy and will continue to have an impact for the foreseeable future,” he told the Montreal Chamber of Commerce. “Adjustment must take place. It hasn’t been easy, and it hasn’t been without pain. And adjustment won’t be easy in the months and years ahead.”

Among these “powerful” forces, the incredible economic growth in Asia and low global interest rates have driven demand for commodities, along with the Canadian dollar.

But he says most Canadian businesses have met the challenges they face head on and are already well on their way to making the needed adjustments. This proactive approach in the private sector has made his job somewhat easier.

“For our part, we remain committed to keeping inflation low, stable, and predictable,” he said. “That is the best contribution we can make to helping output and employment remain strong.”

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J.D. Power rates brokerages

(June 21, 2006) A customer satisfaction survey conducted by J.D. Power and Associates has ranked Edward Jones at the top of the full-service investment industry. The firm scored 796 points out of a possible 1,000.

Second highest in customer satisfaction was Dundee Wealth Management, with a score of 773, followed by Raymond James in third with a score of 771.

Investors were asked to rate their satisfaction in six categories: account set-up, account statement, convenience, cost, the investment advisor/team and investment performance. When asked to weight these factors, clients placed the greatest importance on the role of the investment advisor/team, which accounts for 24% of the overall score.

“Care and attention from the advisor impacts satisfaction considerably,” said Charles Schade, senior director of research at J.D. Power and Associates. “Establishing a meaningful, consistent relationship between the advisor and investor is crucial in achieving satisfaction, which in turn influences customer commitment and loyalty.”

The study found clients with larger portfolios were more satisfied than those with less than $50,000 under management. The study attributes the higher satisfaction to the increased attention the wealthier clients received from their advisor.

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Consumer spending rises

(June 21, 2006) Canadian consumers were showing no sign of fatigue in April, as retail sales surged in that month, up 1.7% from March, according to StatsCan. A large part of that increase was involuntary, of course, as rising gasoline prices all but forced consumers to open their wallets a little wider.

While the price at the pumps soared by 13.5% in that month alone, lower prices on clothing and general merchandise helped to offset that increase. The automotive sector posted the strongest sales increase, rising 3.6%. Spending on home furnishings and electronics declined 1.1%, while building and outdoor home supplies fell by 0.8%.

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Wells Fargo takes 40-year mortgage nationwide

(June 21, 2006) Wells Fargo Financial Canada has announced it is offering a 40-year mortgage, now available nationwide through mortgage brokers and Wells Fargo agents.

“The longer amortization period reduces the monthly payment, making it more affordable for buyers and increasing their monthly cash flow,” said Richard P. Valade, president of Wells Fargo Financial Canada. “Not only is it easier for consumers to qualify for the 40-year mortgage, it gives them more purchasing power.”

The 40-year mortgage is expected to be most popular in regions where housing prices are the highest, such as Vancouver and Calgary. On a nationwide basis, the average home price was recently reported as over $300,000, by the Canadian Real Estate Association.

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