Canada Economic Outlook Increasing economic slack to trigger interest rate cuts We expect weak GDP growth of 0.8% this year, and a fall in inflation to less than 2% next year, to persuade the Bank of Canada to cut its policy rate back to 2.5% by mid-2025. A recovery in... 26th March 2024 · 14 mins read
Canada Economic Outlook Further falls in GDP to trigger interest rate cuts Further declines in GDP in the coming quarters mean that the economy is unlikely to grow at all next year. Weak growth and a return in inflation to the 2% target will leave scope for the Bank of... 7th December 2023 · 14 mins read
Canada Economic Outlook Economy buckling under weight of high interest rates We expect another few quarters of near-zero GDP growth to lead to an annual gain of just 0.7% next year. Even with higher oil prices, the weakness of economic growth leaves scope for CPI inflation to... 26th September 2023 · 14 mins read
Canada Economic Outlook Recession or not, growth to disappoint Strong immigration and the turnaround in the housing market raise the chance that the economy will avoid recession but, with the Bank of Canada back in hiking mode, we still judge that GDP will... 27th June 2023 · 14 mins read
Canada Economic Outlook Full effects of high interest rates yet to be felt The economy made a strong start to 2023, but we continue to expect a moderate recession this year as high interest rates feed through and the banking issues in the US weigh on exports. The downturn... 29th March 2023 · 21 mins read
Canada Economic Outlook Moderate recession to drive inflation lower The economy is heading for a moderate recession, as higher interest rates weigh on domestic demand and exports contract amid the global downturn. Weaker demand, together with lower commodity prices... 8th December 2022 · 20 mins read
Canada Economic Outlook Modest recession could morph into something worse The jump in interest rates and worsening global backdrop leaves the economy facing recession, and elevated debt levels are a downside risk to our forecast for a moderate peak-to-trough fall in GDP of... 6th October 2022 · 20 mins read
Canada Economic Outlook Increased risk of recession The Bank’s aggressive policy tightening will weigh heavily on domestic demand, with consumption growth set to slow sharply while residential investment plunges back to pre-pandemic levels. There is... 20th July 2022 · 20 mins read
Canada Economic Outlook Tighter policy to drive GDP growth below potential Economic activity should expand at a strong pace this year but, with the Bank of Canada set to tighten policy rapidly, we expect the quarterly pace of GDP growth to slow below potential in 2023, as... 21st April 2022 · 19 mins read
Canada Economic Outlook Higher interest rates will leave economy vulnerable Despite a weak start to the year, we expect GDP to rise by 3.6% in 2022 due to broad-based gains in consumption, business investment and net trade. Against that backdrop, the Bank of Canada is set to... 24th January 2022 · 19 mins read
Canada Economic Outlook Supply shortages limiting economic growth We now expect GDP growth to be 4.8% in 2021, rather than 5.0%, and 3.5% in 2022, down from 4.0%. Worsening labour shortages imply that spare capacity has been rapidly absorbed and point to a sharp... 20th October 2021 · 19 mins read
Canada Economic Outlook Consumption to drive recovery The lifting of restrictions and ongoing policy support should translate into a sustained period of above-potential GDP growth, driven by consumption and business investment. We expect GDP growth of 6... 15th July 2021 · 19 mins read
Canada Economic Outlook Vaccinations and policy stimulus to drive recovery The third wave of COVID-19 means that the restrictions on activity will be in place for longer than we assumed, but the economy is poised to recover strongly once vaccinations reach a critical mass... 8th April 2021 · 19 mins read
Canada Economic Outlook Vaccines to drive strong recovery this year and next Despite a rockier start to 2021 than we previously anticipated, we continue to expect the economy to recover strongly from the second quarter onwards, as the vaccine rollout allows restrictions to be... 14th January 2021 · 20 mins read
Canada Economic Outlook Economic weakness will force rate cuts this year We expect GDP growth to slow to only 1.0% this year, as the housing downturn weighs on the domestic economy and exports are held back by the global slowdown. That weakness should prompt the Bank of... 28th March 2019 · 1 min read
Canada Economic Outlook Oil and housing to weigh on growth The economy is set to weather the slump in oil prices better than it did in 2015, but it will not escape unscathed. The housing market looks shaky and there are signs that higher interest rates are... 13th December 2018 · 1 min read
