Recovery Rests on Vaccine Rollout: Canada’s Two-Year Outlook—January 2021

The Conference Board of Canada, 20 pages, January 12, 2021
Impact paper
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This quarterly economic forecast provides highlights of the Canadian Outlook report, which presents the short-term national outlook.

Document Highlights

  • Canada’s economy rebounded through the summer, but rising COVID-19 cases—both at home and south of the border—will slow the pace of recovery. Many businesses in Canada face dim prospects over the first half of 2021.
  • A successful rollout of vaccines will encourage households to spend some of what they’ve amassed in savings. Household balance sheets are in great shape thanks to government support and travel bans that have cut spending on foreign travel to almost nothing.
  • The federal and provincial governments are pledging continued support to businesses and households. The pandemic will drive up public debt to record levels, putting a strain on government finances and public spending once the crisis is past.
  • Real GDP is forecast to post growth of 5.3 per cent in 2021 and 3.5 per cent in 2022. This follows the deepest recession in modern times. We estimate that economic activity dropped by 5.3 per cent in 2020.

Appendix A—Methodology

Table of Contents

  • Key findings
  • Global and U.S. outlooks
  • Business sector
  • Household sector
  • Housing markets shrug off pandemic
  • Fall fiscal update makes big promises, but details remain sketchy
  • Steady rates will help guide the recovery

Appendix A—Methodology

 

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