Canada Economic Forecast
October 27, 2020
The economy likely recovered markedly in Q3. Monthly GDP increased solidly in July, while projections pointed to another healthy expansion for August. Moreover, in September, the unemployment rate fell 1.2 percentage points from the month prior, with the labor market recouping roughly 76% of the jobs lost in March and April. Furthermore, retail sales grew modestly in August, while a flash estimate pointed to a flat reading for September, hinting at stronger private consumption in Q3. In addition, residential investment likely rebounded notably in Q3, as suggested by a surge in housing starts during the quarter. That said, daily crude oil production contracted slightly in July from June, pointing to a subdued energy sector. In politics, Prime Minister Trudeau survived a confidence vote on 21 October thus avoiding a snap election, amid a tightening of some Covid-19 restrictions in recent weeks.Canada Economic Growth
Next year, GDP is set to rebound robustly as strong fiscal and monetary stimulus support domestic demand. Household spending should benefit from a lower unemployment rate and recovering consumer confidence. That said, recently renewed domestic lockdown and travel restrictions, as well as future developments in commodity prices, pose significant risks to the outlook. FocusEconomics analysts project growth of 4.9% in 2021, which is down 0.1 percentage points from last month’s forecast, and growth of 3.1% in 2022.Canada Economy Data
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Canada Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 1.70 | 1.00 % | Dec 31 |
| Exchange Rate | 1.30 | 0.15 % | Jan 01 |
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Canada Economic News
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Canada: Manufacturing PMI decreases in January, but remains upbeat nonetheless
February 1, 2021
In January, the IHS Markit Manufacturing Purchasing Managers’ Index (PMI) fell from 57.9 in December to 54.4.
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Canada: GDP growth accelerates in November; Preliminary estimate points to a slowdown in December
January 29, 2021
The economy grew 0.7% month-on-month in November, picking up from October’s 0.4% increase, and beating Statistics Canada’s preliminary estimate of 0.4% made back on 27 December.
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Canada: Bank of Canada keeps rates unchanged in January; maintains asset purchasing program
January 20, 2021
On 20 January, the Bank of Canada (BoC) kept its target for the overnight rate at 0.25%, its effective lower bound, in line with market analysts’ expectations.
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Canada: Housing prices growth loses further steam in December
January 20, 2021
According to the Teranet-National Bank Composite House Price Index, house price growth decelerated to 0.6% on a month-on-month non-seasonally-adjusted basis in December, from November’s 0.9%.
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Canada: Inflation eases in December
January 20, 2021
Consumer prices rose a seasonally-adjusted 0.14% in December over the previous month, slowing down from November's 0.29% increase.
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