Bank Of Canada Governor Poloz’s Speech In Vancouver (text)

The Fed said it would continue buying bonds at an $85 billion monthly pace, citing strains in the economy from tight fiscal policy and higher mortgage rates. “People are extremely surprised. All life-support systems remain for the time being,” said Matt Skipp, president of SW8 Asset Management, a Toronto-based hedge fund. “Obviously the markets are taking a big leg up as a result,” he added. “But there might be moments of introspection when you realize they don’t have enough confidence in the economy to begin to taper.” Skipp said he doubled his exposure to gold-mining stocks to 10 percent of his portfolio after the Fed statement. The Toronto Stock Exchange’s S&P/TSX composite index closed up 97.29 points, or 0.76 percent, at 12,931.40, after rising as high as 12,958.88, its highest level since August 2011. About 382 million shares changed hands, compared with an average daily volume of about 291 million shares in August, according to market operator TMX Group. “The Fed is still priming the pump, so it looks like everyone’s jumping on the bus,” said Elvis Picardo, strategist at Global Securities in Vancouver. “It does seem that the money that was on the sidelines is coming pouring in.” “Interest is starting to come again into the TSX,” he added. “If the U.S. and global economies continue to do well, it’s very hard to make a bearish case for the TSX, and the bulls would prevail in that case.” The benchmark Canadian index is up nearly 6 percent this quarter.

Serbia beats Canada to reach Davis Cup final

Novak Djokovic pulled Serbia even with Canada with a straight-sets victory against Milos Raonic in Belgrade, Serbia, on Sunday.

However, I anticipate that the Canadian economy will normalize and growth will become natural, in contrast to the economic activity of the past six years, which has been fuelled by policy, including record-low interest rates. Natural growth will be self-generating and self-sustaining, and the economy will be growing at its potential, as its productive capacity expands. Inflation will be back to our target of 2 per cent. As I have said before, policy rates in Canada will be higher than they are today. We can expect that short-term interest rates, as is normal, will be above inflation. Long-term rates will settle into place along a natural, upward-sloping yield curve. We can anticipate a better balance in Canada between domestic and foreign demand. All components of GDP will contribute to growth, again, as normal. The unemployment rate in Canada can also be expected to come down to a more natural level. Consumer and government debt loads will be on a sustainable path. Firms will be generating self-sustained growth.

“It seems I can’t have a match without drama.” Djokovic, coming off a four-set loss to Rafael Nadal in the U.S. Open final on Monday, dimmed Canada’s chances with one of his trademark displays against the 11th-ranked Raonic. “This is like the (football) World Cup for us,” Djokovic said. “Winning the Cup in 2010 gave us players so much confidence.” Djokovic kept the big-serving Canadian at 10 aces, compared to the 34 he had in his five-set victory against Tipsarevic on Friday, and broke Raonic six times in front of some 10,000 boisterous Serbian fans. Raonic, apparently struggling with an ankle injury he sustained Friday, put up tough resistance in the first set. But his game started crumbling after being held to a single point in the tiebreaker. “I felt that I was dealing with anguish and pain,” Raonic said. “He really played well in that tiebreaker.” Czech Republic-Argentina PRAGUE (AP) Argentina won both reverse singles on Sunday to reduce the Czech Republic’s victory to 3-2 in the Davis Cup semifinals. Tomas Berdych and Radek Stepanek won both opening singles on Friday and teamed up to win the doubles over Carlos Berlocq and Horacio Zeballos on Saturday for an unbeatable 3-0 lead for the defending champion in the best-of-five series. In the reverse singles, Zeballos saved two match points before coming back to beat Lukas Rosol 4-6, 7-6 (6), 6-4 and Leonardo Mayer got the second point for Argentina by defeating Jiri Vesely 6-4, 6-4. The Czechs reached their third final in five years.