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Alberta will sink into recession this year, as provincial fortunes turn amid oil’s collapse, CIBC predicts
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$ l' \7 T) {; T# P- [Gordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET
% R6 {7 X* b: Z6 _More from Gordon Isfeld
: V# g8 v* A1 @9 z* M0 r" wLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.
6 [5 U" F0 [0 D- g4 j; Q: U, e: ^# aBloombergLast 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.
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0 @+ I+ t! L7 z- _/ jThat 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.
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6 o; H1 I: P9 q: V( gIn 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.”& r8 ]9 Y1 {% @9 f; W
, W; p. Z- L3 j( {0 _Most startling, perhaps, is the likelihood Alberta will go from the leading economic power house in 2014 to recessionary levels this year.7 Y0 w. G9 q+ C$ ~" q4 f5 i3 F
& Q# X$ x3 f. N4 b) n: Q7 O2 c' d“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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( u2 S8 L% H) C- O4 ~ N; uAs 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.. h# m$ G6 m9 ^! y c% j; v
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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%. t$ p7 Z3 h1 @& k& n2 z
1 F( ?4 u5 u6 O6 nIn 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., S8 W9 ]- Y. S% r5 p7 P
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9 N8 S( p* {: K4 |6 B2 m U7 XThe best oil traders in the business say this rout is not over$ R, A7 |* z4 w/ ~1 \7 Y4 q
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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.) U' q# @' l5 L9 I9 i, o* k4 d% Z
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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.: V8 c$ |! D8 h* q
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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.0 x, Z8 k" P" g- w0 W% |! w
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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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6 v1 r* K% Q0 q8 y& mThe 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$53 on Tuesday, a gain on recent sessions.9 P$ k, H5 o3 p: D( |
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Meanwhile, the Canadian dollar closed near the US81￠ level.
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6 o, t5 o0 T. s0 v8 tThe 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.
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0 Y0 [1 g2 ?) _/ r! w4 z“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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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%.+ ?5 b8 E; x) x P
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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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