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More than 150,000 federal public servants across the country will go on strike starting Wednesday, after Ottawa and the union representing these workers failed to reach a deal for a new collective agreement by Tuesday evening’s strike deadline.

It will be one of the largest national strikes in Canadian history, coming on the heels of a prolonged inflation and cost-of-living crisis.

“Our issues at the bargaining table have still not been addressed by the employer. We do not have a tentative agreement. Our 155,000 members of the Public Service Alliance of Canada will be on strike as of 12:01 a.m. tomorrow,” declared Chris Aylward, president of PSAC at a news conference in Ottawa late Tuesday evening.

Mr. Aylward added that the union and the government were still “a ways apart” on a deal, but reiterated that the union would stay at the bargaining table if the government too was prepared to stay at the table.

“Our members are calm, but they are prepared to fight,” he said.

Given the number of workers involved in the strike spread across various federal departments, its impact will be felt acutely by Canadians. A variety of public services across the country could face backlogs and delays, including immigration and passport applications, employment insurance claims, as well as tax filings ahead of the April 30 deadline. PSAC workers in ports across the country will also be on strike, potentially causing supply chain disruptions. Slowdowns at the border are expected as well, according to the union, as certain administrative staff from the Canada Border Service Agency will be on strike.

A strike will send roughly 120,000 workers off the job – 34,000 others are deemed essential and would keep working, according to the union

Picket lines will be set up in more than 250 locations across the country, the union said.

On Monday, PSAC president Chris Aylward described the mood at the bargaining table as “frustrating” and said that both sides were still “too far apart” on key issues including wages, job security and remote work.

The government has said that it is committed to reaching agreements that are “fair to employees and reasonable for taxpayers.” In a statement issued Monday, the Treasury Board stated that beyond wages, PSAC had “made it clear” that it would walk away from negotiations unless remote work language was enshrined into collective agreements.

Various PSAC bargaining units have been at the negotiating table for over 18 months now, and some of them have reached deals with Ottawa – but the most contentious negotiations have been between the government and four bargaining units made up of 120,000 Treasury Board workers. These workers range from operations service employees who maintain federal government buildings, to administrative staff across various departments and agencies.

From the start of negotiations, PSAC has been pushing for a 13.5-per-cent wage increase spread over three years, which the union says matches inflation. The government’s opening offer in 2021 was a 2.07-per-cent increase per year over three years, but last May it increased that to a cumulative 8.2 per cent spread over three years. On Monday the government upped its offer again to 9 per cent, over three years, in line with a recent suggestion from the Federal Labour and Employment Board’s public interest commission.

Negotiations for 35,000 CRA workers are taking place at a separate bargaining table, led by representatives of the Union of Taxation Employees, an arm of PSAC. The union is asking for a wage hike of 4.5 per cent in 2021, 8 per cent in 2022 and 8 per cent in 2023, again arguing that it is in line with inflation and private sector wage gains over the past few years. The government has not made its wage offer public – earlier this week, Mr. Aylward said the union had yet to receive a wage offer from Ottawa for CRA workers.

The federal labour board’s public interest commission had said, in a report earlier this year, that both sides in this particular negotiation had “completely divergent” views about the state of the Canadian economy and the government’s fiscal circumstances, although it also noted that there were many areas of potential compromise and trade-offs.

If the strike prolongs, the Liberal government could potentially table back-to-work legislation which would legally force public servants back to their jobs through an imposed contract, or enter into binding arbitration with the union. But the government would need to rely on support from the Bloc Québécois and the Conservatives to get the bill passed – NDP Leader Jagmeet Singh emphasized Monday that his party would not support any kind of back-to-work legislation.

• Fox Corp. and its cable networks agreed to pay $787.5 million to Dominion Voting Systems to settle a defamation lawsuit over false claims that Dominion’s machines swayed the outcome of the 2020 presidential election.
• The settlement, which came after a jury had been seated, averted a weekslong trial that could have seen top Fox TV hosts and network boss Rupert Murdoch publicly testify.
• Dominion CEO John Poulos told reporters outside court that, as part of the settlement, “Fox has admitted to telling lies.”

Fox News and Dominion settle election defamation lawsuit (cnbc.com)

Big global money managers got rid of a high volume of Chinese equities in recent days, while adding U.S. energy shares to portfolios at a near-record pace, according to a Goldman Sachs report.

Managers decided to sell Chinese equities amid heightened geopolitical tensions between the world’s second largest economy and the United States.

“As concerns heightened around geopolitics, Chinese equities were net sold for the first time in a month, driven by risk unwinds with long sales outpacing short covers,” Goldman Sachs said, adding investors had sold both offshore and onshore shares.

Besides geopolitics risks, managers are closely watching China’s economic recovery from the COVID-19 slump. The MSCI Index is up 9.6% this year, after a 22% drop in 2022.

Goldman Sachs compiled data from its clients, which include hedge funds and other big money managers, for the period between April 7 and April 13.

Gross exposure to China, which includes funds’ short and long positions, went down 2.6% for this period.

While selling China, hedge funds net bought U.S. energy shares at the fastest pace in three months, Goldman Sachs said. The move was driven by a rally in crude oil price this year after Saudi Arabia and its allies in OPEC+ surprised traders by announcing an unexpected cut in their output target at the start of April.

The bank noted that last week’s U.S. net buying was at a near-record pace for the past five years.

Canada’s inflation rate is rapidly cooling as expected this spring, with consumers benefiting from a pullback in energy costs and weaker price hikes for appliances and other durable goods.

The Consumer Price Index (CPI) rose 4.3 per cent in March from a year earlier, down from February’s 5.2-per-cent pace, Statistics Canada reported on Tuesday. The slowdown was widely anticipated and matched financial analysts’ predictions.

And there should be more progress in the coming months. The Bank of Canada projects inflation will ease to around 3 per cent by the middle of the year, before returning to 2 per cent by the end of 2024. The central bank outlined that path for inflation at last week’s rate decision, which held the benchmark interest rate at 4.5 per cent.

Instant reaction to Canadian inflation data: markets no longer pricing in BoC rate cuts this year

Price growth is moderating as businesses and households adjust to the highest interest rates in more than 15 years, and as supply chains recover from significant disruptions. There are also favourable base effects at play: The initial surge in commodity prices as Russia invaded Ukraine is no longer part of the year-over-year calculation of CPI growth.

Even so, the short-term trend has noticeably cooled off. Expressed at an annualized rate, the three-month change in core inflation (excluding food and energy) was 3.1 per cent in March, down from 3.4 per cent in February. It had peaked at more than 8 per cent in May, 2022.

“While Canadian households can’t look forward to broad-based price declines, there are growing signs that the pace of price growth is settling down,” Royce Mendes, head of macro strategy at Desjardins Securities, said in a note to clients.

Gasoline prices fell nearly 14 per cent over the past year, although they were up 1.2 per cent from February. The price of durable goods rose 1.6 per cent in March on a 12-month basis, slowing from a 3.4-per-cent gain in February.

There have also been slight improvements in the grocery sector: Those prices rose 9.7 per cent over the past year, down from increases of more than 11 per cent in recent months.

On the flip side, mortgage interest costs have surged by 26.4 per cent over the past year, rising from February’s gain of nearly 24 per cent. “This was the largest yearly increase on record as Canadians continued to renew and initiate mortgages at higher interest rates,” Statscan said in its release. Excluding these costs, the CPI rose 3.6 per cent over the past 12 months.

On several occasions last week, Governor Tiff Macklem said the Bank of Canada would not be satisfied with inflation ebbing to 3 per cent and pushed back against market expectations that it could start cutting interest rates later this year. The bank aims for the midpoint of a 1-to-3-per-cent range for inflation, giving it wiggle room on either side of its 2-per-cent target.

“We are encouraged with the progress so far. And getting inflation down to 3 per cent this summer will be [a] welcome relief for Canadians,” Mr. Macklem said at a press conference last week. “But let me assure Canadians that we know our job is not done until we restore price stability. That means inflation is centred on the 2-per-cent target.”

While inflation is continuing to subside, the BoC has indicated that the final leg of the journey – bringing CPI growth to 2 per cent from 3 per cent – could prove challenging. This is because inflation expectations are declining slowly, wage growth and services inflation remain elevated and corporate pricing behaviour needs to cool, Mr. Macklem said.

“Markets are no longer pricing in rate cuts in Canada this year and have opened the door to further hikes in the near term,” Mr. Mendes said. “However, with the recent global banking system stresses unexpectedly tightening financial conditions, we think rate hikes are now a thing of the past and cuts will begin around the turn of the year.”

Pilots at WestJet Airlines have voted to go on strike next month as they seek better pay, job protection and working conditions at Canada’s second-largest carrier.

Nine-three per cent of the votes cast by pilots who fly for WestJet Group, which includes discount brand Swoop, voted for the work stoppage, said Bernard Lewall, a union leader at Air Line Pilots Association.

The earliest the pilots can strike or be locked out by the employer is May 16, according to labour laws. The ballot’s participation rate was 95 per cent, the union said.

“It’s an indication of just how unified this pilots’ group is,” Mr. Lewall said by phone. “Our pilots are fed up. They want to give [union leaders] a mandate to get management back to the bargaining table and negotiate in good faith.”

The two sides have been in talks since September, and continue to negotiate daily.

Among the union’s demands is equal pay and work conditions for pilots at WestJet and Swoop. Mr. Lewall said the Swoop pilots fly the same Boeing 737 planes on many of the same routes as their WestJet colleagues, but for less money. The issue becomes more important with WestJet’s takeover of Sunwing Airlines.

In a statement, WestJet said a strike authorization vote is a common part of the bargaining process, and does not mean a strike will occur. “We remain unwaveringly committed to achieving an agreement that is competitive within Canada’s airline industry and ensures we have a long-term sustainable future so that we can continue to operate critical air service for millions of Canadians, while providing jobs for thousands at the WestJet Group,” Diederik Pen, WestJet Group chief operating officer, said in the statement.

Calgary-based WestJet lost 240 pilots last year and another 100 this year, Mr. Lewall said. They are leaving for better pay, working conditions and career certainty, often in the United States. WestJet pilots are paid 45 per cent less than their U.S. counterparts, Mr. Lewall said in an interview.

“What our pilots need is a North American standard contract .. to retain the pilots we currently have and attract new ones,” Mr. Lewall said.

“We are losing our experienced pilots, we are hiring some pilots, but it’s not replacing the ones that we’re losing, which is frustrating for us,” he said.

Other issues include that WestJet has said it will stop adding Boeing 787s, a larger plane on which pilots are paid better. And the airline’s recent move to focus less on Eastern Canada means Toronto-based flight crews are getting fewer flights, he said.

WestJet controls about 31 per cent of the Canadian market, behind Air Canada at 49 per cent.

Galen Weston will step back from day-to-day operations at Loblaw Cos. Ltd. L-T -1.09%decrease by early next year, the company announced on Tuesday, saying it has hired European retail executive Per Bank to take over as president and chief executive officer.

Mr. Bank is currently the CEO of Salling Group A/S, Denmark’s largest retailer with roughly $13-billion revenue in 2021, the most recent year for which figures were available. Salling operates 1,700 grocery stores in three countries as well as department stores. Loblaw, Canada’s largest retailer, operates more than 2,400 stores across various grocery banners as well as the Shoppers Drug Mart chain, with $56.5-billion in revenue last year.

Mr. Weston will continue in his role as chairman of Loblaw’s board, as well as chair and CEO of parent company George Weston Ltd. In that capacity, he will continue to oversee the “vision, strategy and capital allocation” of the family-controlled companies, he said on a conference call Tuesday to discuss the announcement.

“I’m not leaving. I’m stepping back into what I consider to be my natural role as controlling shareholder,” Mr. Weston told analysts on the call.

The search for a new CEO began in August, 2022, precipitated by the planned retirement of chief operating officer Robert Sawyer at the end of this year.

Loblaw board says Galen Weston is underpaid, boosts compensation

Mr. Sawyer came out of retirement to join the company in 2021, when Mr. Weston returned as president following the departure of Sarah Davis. At the time, Loblaw also replaced chief financial officer Darren Myers with George Weston CFO Richard Dufresne, who will continue as CFO of both companies.

Since then, the executive team has been working to boost Loblaw’s performance, undertaking a strategic review of its operations designed to narrow the company’s focus and get back to what Mr. Weston referred to as “retail fundamentals.”

“The plan was always that Robert would only be with us for a couple of years,” Mr. Weston wrote in an internal memo to Loblaw staff on Tuesday. He said that the appointment does not signal any intention to change the company’s strategic direction.

“The intent is to continue to execute against the strategic path that has been developed by Richard, myself and Robert,” Mr. Weston said on the call.

Over the past two years, that leadership team has also seen Loblaw through a time of soaring food inflation that has contributed to higher revenues and profits in the grocery industry. Mr. Weston, along with other industry executives, has faced questions about whether retailers are doing enough to mitigate the sharp rise in the cost of basic necessities.

Mr. Weston, as a public figure representing the billionaire Weston family and as advertising spokesman for the retailer, has been in the line of fire over the issue. But that was not a factor in his decision to step back, Loblaw spokesperson Catherine Thomas said.

“At the end of the day, this will be nearly a two-year process. To think that it is at all reactionary would be wrong,” Ms. Thomas said. She added that Mr. Weston has made fewer appearances in Loblaw ads over the past year, but did not say whether he would continue as spokesperson in future. “That is a decision for another day,” she said.

On the call Tuesday, Mr. Weston alluded to Mr. Bank’s experience in a highly public CEO role, saying it would help him navigate the position Loblaw occupies in Canada.

“He has been leading an organization that has an outsized cultural and financial place inside his country, and that’s the case for Loblaw,” Mr. Weston said. “We’re a big company in a small country, and that comes with different leadership challenges and opportunities.”

On Tuesday, Statistics Canada reported that inflation began to cool in March, including some improvements in the price of groceries, which rose by 9.7 per cent compared with the prior year, down from increases of more than 11 per cent in recent months. But food is still outpacing the overall inflation rate, which was 4.3 per cent in March compared with the prior year.

In that climate, Loblaw has benefitted from a shift to discount grocery stores such as No Frills, which make up roughly 60 per cent of the retailer’s store network.

“Mr. Bank will be taking the helm of a Loblaw enjoying strong momentum and results, well-positioned against the backdrop of high prices and value-seeking, cash-squeezed consumers,” RBC Capital Markets analyst Irene Nattel wrote in a research note on Tuesday.

In Mr. Bank, Loblaw has also hired an executive with experience serving as CEO of a family-controlled company with a long history. Salling was founded in 1906, and over the course of 94 years, the company was led by just two CEOs, the founder and his son. Mr. Bank became the fourth CEO in Salling’s history in 2012, growing the retailer’s market share by more than 20 per cent, and leading a number of acquisitions, including the Polish operations of Tesco and Toys “R” Us in Denmark.

Historically, as with Ms. Davis, the top role at Loblaw did not include the title of CEO, and reported to Mr. Weston directly; Mr. Bank adds that title and will report to the board.

“There’s important symbolism in that. Having said that, this is a controlled company,” Mr. Weston said. “… And the long-term strategic vision of the company – it’s essential that there’s a high level of alignment between myself and any chief executive or any key operating executive.”

Mr. Weston also noted that Mr. Bank has experience beyond running retail stores, including sitting on the board of the Bank of Denmark, providing the central bank with perspectives on consumer behaviour.

Mr. Bank will join Loblaw by the first quarter of 2024.

Monday April 17

(8:30 a.m. ET) Canadian wholesale trade for February. Analyst estimate is a month-over-month decline of 1.6 per cent.

(8:30 a.m. ET) Canadian international securities transactions for February.

(8:30 a.m. ET) U.S. Empire State Manufacturing Survey for April.

(10 a.m. ET) U.S. NAHB Housing Market Index for April.

Earnings include: Charles Schwab Corp.; JB Hunt Transport Services Inc.; PrairieSky Royalty Ltd.; State Street Corp.

—

Tuesday April 18

China GDP, industrial production, retail sales and fixed asset investment

Euro zone trade deficit

(8:30 a.m. ET) Canadian CPI for March. The Street is expecting an increase of 0.6 per cent from February and up 4.3 per cent year-over-year.

(8:30 a.m. ET) Canadian new motor vehicle sales for February. Estimate is a year-over-year rise of 7.0 per cent.

(8:30 a.m. ET) U.S. housing starts for March. Consensus is an annualized rate decline of 3.1 per cent.

(8:30 a.m. ET) U.S building permits for March. Consensus is an annualized rate drop of 6.1 per cent.

(11:30 a.m. ET) Bank of Canada Governor Tiff Macklem and Deputy Governor Carolyn Rogers appear before the House Standing Committee on Finance.

Earnings include: Bank of America Corp.; Bank of New York Mellon; Goldman Sachs Group Inc.; Johnson & Johnson; Netflix Inc.; Prologis Inc.; United Airlines Holdings Corp.

—

Wednesday April 19

Japan industrial production

Euro zone CPI

(8:15 a.m. ET) Canadian housing starts for March. Estimate is an annualized rate decline of 3.7 per cent.

(8:30 a.m. ET) Canadian industrial product and raw materials price indexes for March. Estimates are month-over-month declines of 0.3 per cent and 0.5 per cent, respectively.

(8:30 a.m. ET) Canadian consumer and mortgage credit for February.

(2 p.m. ET) U.S. Beige Book is released.

Earnings include: Abbott Labratories; Alcoa Corp.; Baker Hughes Co.; IBM; Kinder Morgan Inc.; Metro Inc.; Morgan Stanley; Nasdaq Inc.; Rio Tinto ADR; Tesla Inc.; U.S. Bancorp.

—

Thursday April 20

Japan trade deficit and machine tool orders

Euro zone consumer confidence

Germany producer prices

(8:30 a.m. ET) U.S. initial jobless claims for week of April 15. Estimate is 240,000, up 1,000 from the previous week.

(8:30 a.m. ET) U.S. Philadelphia Fed Index for April.

(10 a.m. ET) U.S. existing home sales for March. Consensus is an annualized rate decline of 1.8 per cent.

(10 a.m. ET) U.S. leading indicator for March.

(11:30 a.m. ET) Bank of Canada Governor Tiff Macklem and Deputy Governor Carolyn Rogers appear before the Senate Standing Committee on Banking Commerce and the Economy.

Earnings include: American Airlines Group Inc.; American Express Co.; Blackstone Group Inc.; CSX Corp.; Philip Morris International Inc.; Taiwan Semiconductor Manufacturing Co. Ltd.; Union Pacific Corp.

—

Friday April 21

Japan CPI

Euro zone manufacturing and services PMI

(8:30 a.m. ET) Canadian retail sales for February. Estimate is a decline of 0.6 per cent from January.

Earnings include: Freeport-McMoran Inc.; HCA Healthcare Inc.; Procter & Gamble Co.; Schlumberger NV

Published: 4/14/2023 3:12 PM ET

Crude oil futures settled modestly higher on Friday, lifted by the International Energy Agency’s forecast that global crude demand will grow to a record 101.9 million barrels per day this year.

West Texas Intermediate Crude oil futures for May ended higher by $0.36 or about 0.4% at $82.52 a barrel.

Brent crude futures were up $0.16 or 0.19% at $86.25 a barrel a little while ago.

The International Energy Agency (IEA) said in its monthly oil market report that oil demand will grow by 2 million barrels per day in 2023, driven mostly by stronger Chinese consumption after the lifting of COVID restrictions.

The IEA expects supply to remain tight, and sees a drop of 400,000 barrels per day by the end of the year.

Earlier this week, data from China showed that the world’s second largest economy saw its crude oil imports rise by 12.4 million barrels per day in March, up from 10.7 million barrels in February. The March volume was the largest since June 2020.

Data from Baker Hughes showed the total number of total active drilling rigs in the United States fell by 3 this week, after falling 4 last week.

The total rig count fell to 748 this week. Oil rigs dropped by 2 this week to 588, while gas rigs fell by 1 to 157.

Beijing this week announced revisions to its conscription policy and said that should China enter a state of war, veterans and educated college students can expect to be on top of the list to be drafted. 

China has positioned these changes as a necessary step to modernize the People’s Liberation Army (PLA) and to bolster its combat effectiveness. 

However, adding the nation’s most educated as priority draftees runs counter not only to traditional Western conscription practices, but China’s as well. 

Chinese honor guard arrive for the welcoming ceremony for French President Emmanuel Macron and China’s President Xi Jinping in Beijing on April 6, 2023. (LUDOVIC MARIN/AFP via Getty Images)

CHINA SANCTIONS US LAWMAKER FOR HIS VISIT TO TAIWAN, CLAIMING HE VIOLATED ‘ONE CHINA’ PRINCIPLE

“It fits into the context of PLA modernization,” Heino Klinck, former deputy assistant secretary of defense for East Asia and military attaché to China, told Fox News Digital. “The PLA has historically been a military based on conscripts from the countryside. I think Chinese President Xi Jinping is trying to further bolster his communist bona fide by ensuring that all segments of Chinese society are a part of the national military buildup.”

Several of China’s top universities already have military departments included in their institutions where students can combine their studies with military training. 

One top official in China’s Central Military Commission told a PLA newspaper this week that colleges and universities play an essential role in recruiting and that there is a particular interest in female and male students or graduates with a background in science, technology, engineering and mathematics.

China also plans to instate a new standardized recruitment processes that will implement steps to improve the physical, mental and political assessments of recruits.

Ultimately, Beijing hopes to “provide institutional guarantees for consolidating national defense and building strong armed forces” by “recruiting more high-caliber soldiers,” according to a government announcement Wednesday.

Chinese honor guard arrive for the welcoming ceremony for French President Emmanuel Macron and China’s President Xi Jinping in Beijing on April 6, 2023. (LUDOVIC MARIN/AFP via Getty Images)

CHINA’S DEFENSE MINISTER SET TO MEET WITH RUSSIAN COUNTERPART, OTHER MILITARY OFFICIALS IN MOSCOW

Klinck explained that the revisions to China’s conscription policies were not necessarily a surprise, though their timing has prompted some pause for concern. 

“I don’t know what’s worse: that they are tone-deaf or are they intentionally messaging?” he questioned. 

The announcement came just days after top U.S. lawmakers traveled to Taiwan in a show of “deterrence” against Chinese aggression, which occurred simultaneously with a trip by Taiwanese president Tsai Ing-wen to the U.S., where she met with House Speaker Kevin McCarthy. 

Beijing responded by launching large-scale combat exercises around Taiwan that simulated sealing off the island — similar to drills it launched last year after then-House Speaker Nancy Pelosi traveled to Taipei. 

Klinck described the conscription announcement as “arrogant” and noted his concern that Beijing is “recklessly making policy announcements with a total disregard to how the international community will interpret them.”

“The Chinese are usually pretty good when it comes to messaging and consistency,” he added. “I think that this is once again an indication that we should not anticipate the Chinese Communist Party softening its stance on Taiwan, softening its stance on the South China Sea or any other contentious geopolitical issue of concern.”

It is unclear how many fighting-age men China’s latest policy changes would add to its more than 2 million-strong ranks, or how its army could hold up to top militaries like the U.S. 

https://2882a2a7b826e999997a8c32bb6dc7e6.safeframe.googlesyndication.com/safeframe/1-0-40/html/container.html

A boat moves through the water at the 68-nautical-mile scenic spot, the closest point in mainland China to the island of Taiwan, in Pingtan in southeastern China’s Fujian Province on Aug. 5, 2022. (AP Photo/Ng Han Guan)

Western defense officials have warned that Beijing plans to invade Taiwan by 2027, and last year President Biden raised eyebrows after he said he would send boots on the ground to defend the island from a Chinese attack. 

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“The U.S. needs to speak softly and carry a big stick,” Klinck advised regarding U.S.-Chinese relations. “We need to be very clear that we want a positive relationship with China, but on mutually beneficial terms.”

“It cannot be a relationship where we want it more than the Chinese do. And any attempt to engage with the Chinese at all costs is not in our national interests,” he added.