Canada Economic Forecast

Canada Economic Forecast

November 21, 2017

This year’s sizzling and unsustainable growth appears to be tapering off. GDP contracted in August from a month earlier after recording flat growth in July, ending an eight-month stretch of gains in which the economy expanded at a pace not seen in decades. Although manufacturing took a hit in August, the Ivey PMI climbed through October to reach a 21-month high, suggesting that economic activity has since firmed up. Moreover, employment figures were healthy through October, and the unemployment rate hovered near a nine-year low. Canada’s property market, meanwhile, has taken a hit from new legislation and higher interest rates. With respect to trade, contentious talks continue between U.S., Canadian and Mexican negotiators regarding the future of NAFTA. Furthermore, during November’s APEC summit talks, the Canadian delegation stalled negotiations as it held out for changes to the new TPP-11 deal before agreeing to move forward with the pact.

Canada Economic Growth

Economic growth is expected to continue moderating towards potential next year on slower household spending growth as higher interest rates and a cool-off in asset values weigh on heavily indebted consumers and dampen activity. Upbeat oil and gas exports are expected to support growth, although the possibility of a scrapped NAFTA will loom heavily on the external sector. Met the why particular panelists expect GDP to grow 2.2% in 2018, which is up 0.1 percentage points from last month’s forecast, and 1.8% in 2019.

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Canada Facts

ValueChangeDate
Bond Yield1.901.00 %Oct 18
Exchange Rate1.280.15 %Dec 06
Stock Market15,9090.23 %Dec 06

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