Craig Wright, RBC's chief economist, discusses Ontario's economic growth
TORONTO, March 19, 2014 /CNW/ - Ontario's economy is expected to visibly
pick up in 2014 with export demand and business investment kicking into
higher gear, according to the latest RBC Economics Provincial Outlook issued today. RBC expects real GDP growth to accelerate to a four-year
high of 2.5 per cent in 2014 and an even stronger 2.9 per cent in 2015.
"We believe Ontario exporters stand to benefit strongly from improving
demand from south of the border as the U.S. economy continues to ramp
up significantly this year," said Craig Wright, senior vice-president
and chief economist, RBC. "While there is room for advances in motor
vehicles and parts - Ontario's key export category - greater
opportunities may lie in a broader range of made-in-Ontario products
and services, such as consumer goods, equipment, software applications
The report also notes that the February release of Statistics Canada's
P&PI survey brought some good news on the capital expenditures front -
Ontario businesses plan to increase spending on non-residential outlays
by 3.7 per cent in 2014. Further, manufacturers are penciling in an 8.8
per cent boost, two-thirds of which will take place in the
transportation equipment industry where capital spending is set to
surge almost 29 per cent.
Another positive from the survey was plans by local and municipal
administrations to boost their capital spending by close to 20 per cent
in 2014, RBC says, after three years of considerable declines and amid
largely flat spending at the provincial and federal levels.
"This is evidence that Ontario municipalities are firmly engaged in
addressing the need to upgrade and expand public infrastructures in the
province," said Wright.
On the residential side, the P&PI survey indicated that housing
investments will decline for the second year in a row, which is
consistent with RBC's outlook for the Ontario housing sector. RBC
Economics expects housing starts in the province to moderate to 59,100
units in 2014 from 61,100 units the year prior.
The RBC Economics Provincial Outlook assesses the provinces according to
economic growth, employment growth, unemployment rates, retail sales,
housing starts and consumer price indices. The full report and
provincial details are available online as of 8 a.m. ET today at rbc.com/economics/economic-reports/provincial-economic-forecasts.html.
For further information:
Craig Wright, RBC Economics Research, 416-974-7457
Robert Hogue, RBC Economics Research, 416-974-6192
Elyse Lalonde, Communications, RBC Capital Markets, 416-842-5635