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Alberta will sink into recession this year, as provincial fortunes turn amid oil’s collapse, CIBC predicts+ [* [! {' i8 b+ K. i
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! o6 D) C1 E) {0 GGordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET( H4 t3 j( Z% a9 F
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$ E: M! T _1 q9 FLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.9 @2 w6 O- ~: e4 ^4 T% `
BloombergLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.
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OTTAWA — Consistently low oil prices could dramatically alter the economic landscape of Canada in the coming year and beyond, with Alberta slipping into a “mild” recession as a weak dollar helps lift the manufacturing hubs such as Ontario." E5 q6 a+ r/ H- A, G4 b- o
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That pattern is already being reflected in a slowdown in the oil patch-fueled housing market in Calgary and Edmonton, in addition to an anticipated knock-on increase in unemployment rates in the province.: q6 j+ J9 e9 `6 j) D# t [
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In a report released Tuesday, titled The Tables Have Turned, economists at CIBC World Markets said recent data show “just how sharply the growth leadership is likely to swing.”1 ? O8 v1 E/ M( k% R- C6 Z
3 P) v+ Q/ M. }" n: UMost startling, perhaps, is the likelihood Alberta will go from the leading economic power house in 2014 to recessionary levels this year.- ^1 m4 t# z1 \0 A" m* n; c
0 k* j4 L4 M, e“Alberta looks headed for a mild and temporary recession,” said economists Avery Shenfeld and Nick Exarhos, pointing to a 0.3% decline in 2015, compared with 4.1% growth in 2014.
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* O( ?% O6 L+ D7 s! BAs well, they see growth in Saskatchewan — the country’s other major resources-heavy province — suffering in 2015, managing an advance of only 0.8% this year, after 1% in 2014, but likely avoiding an outright downturn.5 B0 v6 l% v3 J/ ]% D6 o
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However, Newfoundland and Labrador — also reliant on energy revenues — could contract more significantly this year, by 1.3%, and in 2016, by 1%.! w, L4 s+ f' w% D, v- N
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In contrast, Central Canada “should enjoy a small upside surprise,” thanks mainly to a healthy U.S. economy, CIBC predicts, along with a lift in exports from a weak Canadian dollar.
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The best oil traders in the business say this rout is not over8 t E. D6 [7 s; E# P4 e( |
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8 f7 Z8 ~# t" k7 \The Ontario economy will expand 2.8% this year, up from 2.1% in 2014, and add 2.8% next year, according to CIBC. Quebec should add 2.4% this year and 2.6% in 2016, after a restrained advance of 1.8% in 2014, the bank said. At the same time, British Columbia will continue its mid-2% growth trend.6 Z, x; o* x- ~( h8 V
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“That will translate into commensurate shifts in the employment picture, alleviating pressure in some areas — where, if anything, workers are currently in scarce supply — and lowering the jobless rate in Central Canada, where it has been stuck above the national average.”
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8 f# a0 u2 }& s& Z% ^1 J3 H0 q9 ?For example, Alberta’s jobless rate could rise to an average of 6.8% this year, from 4.7% in 2014, the CIBC said, while Ontario should see its unemployment level fall to 6.6% from 7.2% last year.
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CIBC expects overall growth in Canada to be around 1.9% this year, down from 2.4% in 2014, and rising by 2.5% next year.
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Contrast those with the Bank of Canada’s 2.1% outlook for this year and 2.4% in 2016 issued in January, when policymakers surprised markets by cutting their benchmark lending rate to 0.75% from 1%, where it had stood since September 2010.
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The central bank’s GDP forecast is based on an average oil price of US$60 a barrel in 2015 and 2016. Crude was trading above US$53 on Tuesday, a gain on recent sessions.; }4 Y I6 \. \! {: V4 {5 `
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Meanwhile, the Canadian dollar closed near the US81￠ level.
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The regional shift is also evident in the housing market, where the slowdown in Calgary and Edmonton helped pull down national sales by 3.1% in January from December and by 2% from a year earlier, the Canadian Real Estate Association said Tuesday.! h* p( N2 C, M, u- o8 u7 ]
2 j) c8 N- u1 Z- x% a' O, e5 ?* U“As expected, consumer confidence in the Prairies has declined and moved a number of potential homebuyers to the sidelines as a result,” CREA president Beth Crosbie said., Q! p* M3 T" b W0 Z) K2 X
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Total January residential sales in Calgary were down 35.5% from a year earlier, while Edmonton fell 22.7%, Saskatoon lost 24% and Regina was off 6.9%./ [ V3 e5 w& v" y2 e( m, \4 X
: I% k! R9 E' W6 q“There’s little mystery behind the sudden reversal of fortune for the national figures, as sales in Calgary and Edmonton — and Saskatoon — fell more than 20% from a year ago, in what had been the hottest markets in the country,” said Douglas Porter, chief economist at BMO Capital Markets. |
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发表于 2015-2-1 17:34
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