Canadian bank earnings are applied to economic uncertainty

Canadian banks are set to announce their quarterly earned this week, and while the analysts are optimistic about the results, they notice that potential tariffs in the US can weaken the situation.

The big six banks – that is, Royal Bank of Canada,, Toronto-Dominion bank,, Bank of Nova Scotia,, Montreal Bank,, Canada Imperial Bank of Commerce and the National Bank in Canada – Expected to post moderate income growth overall for their first quarter, according to a Monday (Feb 24) report from the Wall Street Journal (WSJ).

However, a possible US trading war means that these banks have to set up capital to support credits in loss, or money separately for loans that do not pay for loans.

“Many analysts focus on analytical estimates of income for the sector to expect higher credit loss provisions on current loans,” as WSJ. “Capital Markets in RBC Capital Total Credit-loss provisions will increase about 32% in the previous quarter and in 5 years across 70 years in Canada ($ billion). The higher provisions eat earnings for this quarter. “

On February 1, President Donald Trump made a 25% Tariff In imports from Canada and Mexico, as well as a 10% energy tariff, but later puts a 30-day mortgage.

According to Monday report From CNBC, Trump says he wants to keep tariffs once deadline ends next week.

When the tariffs were first announced, the Prime Minister of Canada Justin Trudeau Retaliated tariffs affect beer, wine, bourbbon, fruit, equipment, equipment, sports equipment, sports equipment, sports equipment, boards and plastics.

As pymts found At the time, industries that depend on cross-border trading is likely to be the worst affected by a trading war.

“The easiest effect of tariffs always feels at the supply chain,” the pymnts wrote. “Industries dependent on the seamless movement of goods across the bounds are more vulnerable. The tariffs, if it is imposed on raw materials, intermediate goods or finished production costs. For manufacturers, it often means a higher price for substances, parts and materials from countries involved in trade disputes. “

As a result, businesses scrambled at Lifting their supply chainsTransfer from a “reasonable time” to a “Hus-on-case” hedge model against geopolitical risks and economic uncertainty.

A potential trading war also makes consumers can’t stop, with Consumer Simultination of almost 10% from last month and about 16% lower than one year ago, according to February data from Michigan universityLatest Sentiment consumer index.