Canadian Outlook Economic Forecast: Summer 2002

This quarterly economic forecast presents the short-term national outlook.

Document Highlights 

The Canadian economy entered 2002 with a bang, as real gross domestic product (GDP) growth surged to an annualized 6 per cent, one of the highest quarterly rates in the last decade. The huge inventory liquidation in the final quarter of 2001 prompted a swift rebound in industrial production. Restored confidence boosted consumption and investment, while a parallel surge in U.S. growth wrenched the export sector out of recession.

• Growth of the Canadian economy is expected to reach 3.6 per cent in 2002 and 3.9 per cent in 2003.
• Low inventory levels should continue fuelling growth in production.
• Interest rates will rise significantly in order to contain near-term price pressures.
• Spending on big-ticket consumer products is likely to weaken in the second half of 2002.