OTTAWA, June 14, 2013 /CNW/ - Canada's economy is muddling along this
year, but a better performance is expected in 2014 in line with a
revived U.S. economy, according to The Conference Board of Canada's Canadian Outlook - Spring 2013. Currently, a softening housing market, downturn in commodity prices
and ongoing government spending restraint is taking a bite out of
Canada's domestic economy.
"Overall, Canada's domestic economy is not expected to muster enough
strength to get growth in real gross domestic product above two per
cent this year," said Pedro Antunes, Director, National and Provincial Forecast. "Still, the stronger pace
of U.S. growth expected in 2014 should help to lift spirits, resource
prices, trade prospects and income here at home."
The Canadian economy is expected to grow by just 1.8 per cent in 2013.
In 2014, growth in real gross domestic product is expected to accelerate
to 2.5 per cent, due to a strengthening U.S. economy in 2014.
Tightening of mortgage rules is having its intended effect of bringing
the real estate market in for a soft landing - the national average
price of a home is expected to fall by just 2.5 per cent this year and
stay flat through 2014.
Despite lacklustre growth in 2012 and 2013, Canada's economic situation
needs to be viewed in perspective, especially when compared with other
developed countries. Business investment surpassed its pre-recession
peak in 2012, employment and real wages continue to trend upward, and
the trade picture is improving.
The federal government's tightening of mortgage rules is softening home
sales activity and reducing new home construction. The slowdown in
building should help rebalance the market and mute declines in real
Following two years of strong growth, resource sector investment is
waning because of the swoon in many commodity prices.
Struggling to beat back deficits, the federal and most provincial
governments have been in belt-tightening mode since 2011. Most
governments cinched their belts even tighter in their latest budgets.
Overall, little growth is expected in the public sector until at least
SOURCE: Conference Board of Canada
For further information:
Yvonne Squires, Media Relations, Tel.: 613- 526-3090 ext. 221