Strategist, Jim Thorne, says Canada should be one of the ‘wealthiest nations’ but ‘we got off-track’

Strategist, Jim Thorne, says Canada should be one of the ‘wealthiest nations’ but ‘we got off-track’ — here's why

Canada "should be one of the wealthiest nations in the world," proclaimed Chief Market Strategist at Wellington-Altus Private Wealth, Jim Thorne, during an interview with BNN Bloomberg. "But "we've got off track."

As one of Bay Street's most-quoted voices, Thorne has been critical of the national preoccupation with interest rates — and points out that we need to be looking at systemic issues, first, to help economic growth.

Strategist Jim Thorne says Canada's slow project-approval process, not interest rates, is the bigger drag on wealth.

He publicly expressed his concern after the Bank of Canada held its overnight rate at 2.25% for the seventh straight decision.

The focus on interest rates occurs south of the border, as well, with Federal Reserve Chair Kevin Warsh pushing for lower U.S. rates.

Lower U.S. rates could ripple into Canadian borrowing costs.

Thorne's warning means Canadians shouldn't count on a near-term interest rate cut.

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Why is Thorne critical of the focus on interest rates?

Thorne made these comments the same morning as the September Bank of Canada (BoC) interest rate announcement — when the BoC held its benchmark rate at 2.25% for a seventh straight decision — a decision that economists had almost unanimously expected.

Thorne addressed the current lack of interest rate relief, clearly stating that Canadians shouldn't expect the wait to end any time soon. He expects the same wait-and-see message from BoC Governor Tiff Macklem at the Bank's next rate announcement on October 28.

"I think the governor is going to be on hold and … in a wait and see mode," he said, adding Macklem will want to "evaluate the data" tied to the trade war with the U.S. before moving again.

And Thorne doesn't agree with this wait-and-see approach. Instead, Thorne argues that Canada needs to lower interest rates in order to offset an economy that is less diversified than the U.S. — but he doesn't expect that relief soon.

For most analysts, including Thorne, rate relief is not expected to come until well into 2027.

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