The slump in oil prices has already pushed the Canadian economy into a mild recession and things could yet go from bad to worse. Falling energy investment will hit both production and jobs, which will further depress incomes and spending. Meanwhile, housing corrections in oil regions could be followed by busts elsewhere when bond yields rise. We now expect GDP growth of only 1.0% in 2015 and 2016, before a recovery finally begins to take hold in 2017.
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