The Royal Bank of Canada (RBC) has released its monthly update on growth forecasts for the nation and its provinces.
Stronger US Economy Estimated to Bump Canada’s GDP up Nearly 1%
Overall, the RBC projects Canada’s national economy to expand at the faster rate of 2.6% stated RBC’s senior economist, Robert Hogue. This compares to a lackluster 1.7% recorded for both 2012 and 2013.
Increase in Demand for Building Materials, Motor Vehicles, and other Equipment to Boost GDP in Ontario, B.C., and Quebec
The US economy is expected to continue to strengthen over the next two years, with early estimates of the country’s GDP pegged at 3.2% for 2015. “We believe that a healthier and progressively stronger US economy will help reduce the disparity starting in 2014 and contribute to stronger overall growth nationally. Rising US demand for Canadian-made building materials, motor vehicles, and other transportation equipment, machinery, industrial equipment. Growth rates for Ontario, British Columbia and Quebec are expected to rise to 2.6%, 2.4%, and 1.8% respectively,” said Hogue.
Alberta Will Continue to Set Pace for the Country
Meanwhile, it’s believed that Alberta will continue to grow disproportionately faster than the rest of Canada at 3.9%. Not surprisingly, record levels of crude oil production continue to promote a healthy labour market, that has contributed to a rapidly increasing population and hence an overall increase in consumer spending.
Ontario’s Manufacturing Sector Expected to Bounce Back in 2014 After Stalling in 2013
Over the past decade, the rise of the value of the Canadian dollar and reconfiguration of global supply chains has dealt a heavy blow to Ontario manufacturers. Fortunately, service exports have been picking up the slack, but furthermore, this coming year US demand should also make for more favorable results for the country’s product export market and as a result the manufacturing industry as well.
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