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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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/ J0 q9 |' E9 _1 V. a/ V7 _% ~Republish Reprint
; O p: {# F Z- g9 M7 ~Gordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET+ l2 k, O8 K/ z; ~/ g, Z& t
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Last year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.
* W0 c3 k+ T$ |4 T- L; QBloombergLast 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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" z( v$ t* e" E8 wThat 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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7 I/ {2 \- x& |! K6 NIn 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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' t8 `% `; e AMost 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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- F5 Y$ K6 F' t+ s* ]* Q. t9 P* s/ G“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.( ]( W; c' b" |( P, i
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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%.8 G6 |( Y* [! K. i' v& I2 }2 H
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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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Canada’s oil capitals are headed for their first major housing correction since 2008, TD warns
. _; i" ~/ O2 T. j DCenovus Energy Inc slashes staff by 15%, freezes pay in ‘challenging times for oil and gas industry’
9 ^* d- a" U, ?' FThe best oil traders in the business say this rout is not over
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% }: s' x# U- {) K0 L& UThe 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.% M" [: ?8 w. s5 p4 N2 u% F
6 @2 {3 T# R+ P“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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, U( l; i# }, D% CFor 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.! W1 m( |, J) \' b
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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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8 V+ n) r6 l' m% QContrast 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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5 y" s3 `8 Z/ n, t6 Q' a9 FThe 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$53 on Tuesday, a gain on recent sessions.& [ A. D' G4 V. ^
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Meanwhile, the Canadian dollar closed near the US81￠ level.9 |( z. W9 A3 f0 r5 v1 s
4 N$ N% @" T, `! j; z/ EThe 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.0 ~. @; b! `4 C' P+ e" I
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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.- w* ?, Q; I% G9 \% V
/ ?$ a' { ^. K) l1 UTotal 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%./ c: s5 @& d$ P: `9 r
! p7 J9 V! V+ I- d“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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