从衰退到复苏的年中过渡 | 加拿大近距离观察

Hi, my name is Tony Stillo and I’m the director of Canada Economics at Oxford Economics. Today I’ll be reviewing four key themes that will shape the Canadian economy in 2024, which we expect will perform well below the consensus view and worse than other advanced economies.

Theme one: a moderate recession will be followed by a muted recovery. The Canadian economy begins 2024 mired in a recession that began in the third quarter of last year as the lag impact of past rate hikes continues to filter through. Unlike other forecasters who anticipate a soft landing, we expect GDP to contract through mid-year as consumers cut spending and the housing downturn deepens. However, we look ahead to a modest recovery in the second half of the year, when the Bank of Canada and other central banks begin cutting rates.

Theme number two: Canada’s migration led population boom will continue. Another influx of immigrants and temporary residents will further increase Canada’s labor supply. And alongside the modest job losses we anticipate during the recession, drive the unemployment rate well above 7% this year and help ease inflationary pressures. Still, the population boom will increase demand for public services like health and education and drive up rental costs since most newcomers initially rent.

Theme number three: the Bank of Canada will begin an easing cycle as inflation returns to target. Growing slack in the Canadian economy alongside weaker global oil and food prices will bring inflation back to the 2% target by late 2024, about one year ahead of the Bank of Canada soft landing forecast. So we expect the Bank of Canada will hold the policy rate at 5% until mid 2024, when ample evidence of slowing inflation will prompt it to start cutting rates. But in order to avoid a potential course reversal later, we expect the Bank Canada will proceed cautiously, lowering the policy rate to four and a quarter percent later this year.

Theme four: fiscal Policy in Canada will be caught between a rock and a hard place. Barring a severe economic downturn, we believe government will avoid major new fiscal stimulus that could undermine monetary policy and opt for modest targeted measures instead.

Still, the latest federal and provincial fiscal outlooks were all premised on a soft landing for the Canadian economy; and under our recession forecast, fiscal shortfalls will be much larger as tax revenues weaken and expenses grow.