Canadian Outlook Economic Forecast: Summer 2019

The Conference Board of Canada, 138 pages, July 24, 2019
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This quarterly economic forecast presents the short-term national outlook.

Document Highlights

  • The Canadian economy is projected to grow by just 1.4 per cent in 2019.
  • Despite the slow growth, the economy is expected to post one of its strongest job gains on record this year, while tight labour markets are resulting in strong wage growth.
  • Consumer spending will post another solid increase this year despite ongoing concerns about the elevated level of household debt.
  • The housing market will continue to cool this year, with a decline in residential investment and prices.
  • The outlook for business investment is weak. Businesses are expressing a great deal of pessimism about their future spending.
  • Canada’s merchandise exports are expected to see no growth this year, held back by weakness in the energy sector and increased protectionism abroad.

Table of Contents

Executive summary


Section 1—Household income and employment

  • Fireworks open 2019 for Canada’s job market
  • The outlook for labour markets
  • Better wage growth and a slower pace of interest rate increases will benefit household disposable income
  • Canada’s changing labour force

Section 2—Household consumption

  • Healthy labour markets support household spending
  • Household indicators are mixed
  • The outlook for household spending
  • Elevated household debt and rising rates challenges households

Section 3—Housing

  • General easing in store; regional differences continue
  • Inventories nudge higher
  • Starts continue solid
  • Resale prices ease
  • Forecast underpinnings
  • Forecast
  • Local housing markets

Section 4—Government

  • Government spending set for a slowdown
  • Federal fiscal outlook
  • Provincial fiscal outlook
  • Government consumption and investment spending

Section 5—Business investment

  • Evaluating Canada’s investment performance
  • Investment drivers
  • Investment by industry
  • Investment by category

Section 6—International trade

  • Uncertainty on the rise again
  • Trade outlook
  • U.S. outlook
  • Merchandise exports slow to a crawl in 2019
  • Softer domestic demand weighs on merchandise imports in 2019
  • Weaker global demand erodes services deficit in 2019
  • Current account deficit deteriorates in 2019

Section 7—Energy

  • Prospects for 2019 remain limited
  • Global oil prices have been recovering
  • Production cuts in Alberta continue
  • Investment remains weak
  • Alberta production cuts weighing down output

Section 8—Industry trends

  • Industry growth hits some speed bumps in 2019
  • Uneven outlook for primary resources
  • Construction activity plummets in 2019
  • Manufacturing output loses steam
  • Commercial services sector outpaces national trend
  • Demographic trends shape non-commercial services outlook
  • Public administration GDP moderates in 2020

Section 9—Financial markets

  • Slower growth and trade tensions keep Bank of Canada on the sidelines
  • Weak investment, trade outlook drag down Canada’s growth
  • Federal Reserve reverses course
  • Monetary policy in other countries

Appendix A—Forecast tables

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