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Alberta will sink into recession this year, as provincial fortunes turn amid oil’s collapse, CIBC predicts1 Y& s0 I% H" M) g3 }
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- |+ q6 T5 Q; j5 L" g6 xGordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET
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7 ^3 S q1 v, m# d, l" I& P1 S. TLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.' N: A* C' H& u" p+ Q' n
BloombergLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.$ _$ D6 d" }" `4 e6 r7 _% a
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7 O( V! o1 W, p, wOTTAWA — 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.
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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.8 c( w: ^' Z: U; A" L0 ~
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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.”
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Most startling, perhaps, is the likelihood Alberta will go from the leading economic power house in 2014 to recessionary levels this year.
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. S* u$ y( |; `2 x“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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As 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.
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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%.
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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.* z4 c- q5 P. ?! {7 }$ t6 c
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& @1 Z& _& [& k1 c! U7 yThe 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.; y* h' k# \* ?' y
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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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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.! w; J* F) a- _' A
" o5 `2 Z# d4 \0 }& \ f9 S8 _' TCIBC 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.' |, L5 V* y( F' v. r6 o
& g# F. V+ H& D4 e& M; @8 nContrast 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.% q4 g5 S" I2 H/ m/ f. F
' x8 B$ U5 C- Z' S5 U8 C, x6 ZThe 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./ ~5 C: `3 J+ S/ M
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Meanwhile, the Canadian dollar closed near the US81￠ level.
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" [3 m& L8 W# q2 N5 IThe 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.% C; Q P, J, W2 t& w* h8 L, u
" L' H4 h- b5 W* N“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.
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4 S3 e5 n# H9 qTotal 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%. D0 { Q/ g5 o
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“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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