OTTAWA, May 14, 2015 /CNW/ - Thanks largely to a weaker Canadian dollar and a strengthening U.S. economy, Toronto will see its economic fortunes improve this year, according to The Conference Board of Canada's Metropolitan Outlook: Spring 2015.
"For the first time since 1999, Toronto will boast the fastest growing metropolitan economy this year among the 13 cities covered in this edition of our report," said Alan Arcand, Associate Director, Centre for Municipal Studies.
- Toronto joins Vancouver and Halifax as the fastest growing metropolitan economies in the country this year.
- Toronto's economy is expected to expand by 3.1 per cent in 2015.
- The area's manufacturing and transportation and warehousing sectors will benefit from stronger U.S. demand and a weaker Canadian dollar.
- Pan Am/Parapan Games to boost the region's tourism activity.
With a gain of 2.9 per cent, Toronto's economy grew at its fastest pace in four years in 2014. Fortunately, the economy is expected to continue to pick up over the next two years. The city's economy is expected to expand by 3.1 per cent in 2014 and by 3.2 per cent in 2016, supporting employment growth of 1.9 per cent this year and 2.5 per cent next year.
Both the manufacturing as well as the transportation and warehousing sectors will continue to benefit from an improving U.S. economy and a weaker Canadian dollar. Manufacturing output is projected to grow by 2.8 per cent in 2014, the sector's fifth gain in six years. The continued recovery in manufacturing, along with stronger tourism activity, will allow output growth in the transportation and warehousing sector to reach 4.4 per cent this year. In fact, the tourism sector is set for a big year, as it will also benefit from the stronger U.S. economy, weaker loonie, as well as the upcoming Pan Am/Parapan Am Games. Stronger tourism numbers will also bolster activity in wholesale and retail trade and in personal services.
Meanwhile, after falling for the past two years, the construction sector is expected to expand in 2015, up by 3.8 per cent thanks to rising housing starts and a busy non-residential sector.
On the other hand, the contribution to growth from the public sector will be modest, as the provincial government remains focused on balancing its budget.
Most of the 13 CMAs covered in the report will see their economic fortunes improve this year, boosted by lower oil prices, a weaker Canadian dollar, and improving U.S. economy. On the other hand, lower oil prices will hurt economic growth in Calgary, Edmonton, Regina and Saskatoon.
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SOURCE Conference Board of Canada
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