As a result, the income of the workforce as a whole will increase and invigorate consumption. As consumption increases, business fixed investment and housing investment will rise accordingly. An increase in exports on the back of the yen’s depreciation will also lead to a pick-up in investment to increase production capacity.
This trend is likely to continue as we are seeing renewed weakness in global oil prices, which are about 25 per cent lower than in October. This means that Canada is earning less income from the rest of the world.