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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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. E. m f+ n& z& }( rGordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET
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7 P4 F- a: ?6 e6 q$ S) L& @6 gLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.
/ c! V. M/ t Q, F: kBloombergLast 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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/ o6 q6 R C, ~) UOTTAWA — 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.3 t! m- W$ d# W+ i- _- j
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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.
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, S% b. { `% o6 N( f+ C0 ~1 WIn 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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( L/ n& j: K: n; KMost 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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“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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( C& x ^2 r J4 R$ V- h7 ^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%.+ g7 e$ u, N' r
( m& h2 M: J( l' r; N+ h# H, aIn 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.* B% z- p1 Y' j- e, S
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Canada’s oil capitals are headed for their first major housing correction since 2008, TD warns
2 d6 w5 d/ u4 J( v7 yCenovus Energy Inc slashes staff by 15%, freezes pay in ‘challenging times for oil and gas industry’
8 E. i3 }' S+ D3 UThe best oil traders in the business say this rout is not over2 n/ J! s! S- ~
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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.8 M8 W- T5 M W7 V8 w8 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.”7 P6 l* {/ J+ c: L+ ]4 C+ ^& R8 ]8 x
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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.
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! k& r4 f* x/ m% O1 ]) W gCIBC 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.* o8 c2 u% e9 [* J, \5 F
4 n0 _/ E) e- k" h# |. }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.
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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.
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“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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; \( p3 A8 D2 F* WTotal 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%.3 F& K9 h! }+ t8 `
1 |5 b) @8 i/ n, B8 _“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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