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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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& ?$ K/ M9 f; H2 sGordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET8 ^! k' |" F3 T% Y2 d H
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; s# h* w- Q6 \Last year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.& {: D& }1 m7 U9 v7 t
BloombergLast 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.; J& p3 `9 q3 C( F: }
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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.$ n; U6 E3 _# ` b
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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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' J. E' X6 y* ?: R, z" l“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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$ l( o2 V+ h( ?5 lAs 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./ ~' U5 ]" Z6 y4 [8 E
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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%.9 f/ I0 C# t% {$ }# d! z8 U; ?
- s: n6 r) s; @; q( K4 DIn 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.) n% H/ Y1 t5 F; v
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Canada’s oil capitals are headed for their first major housing correction since 2008, TD warns
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The best oil traders in the business say this rout is not over# `) F B1 j! R* ? f9 y
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3 [9 \* v3 w( P( m* C3 {- cThe 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.
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; w; h1 R6 n- ~3 y1 B“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.' Z" L; t( N9 i' a# B
& u0 F, I% U- t3 k& e- c) yCIBC 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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1 H( _/ I' m) w5 Q LContrast 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.( u2 {4 r7 t6 q3 ]
/ u, l- ?2 e6 i/ c; k$ q4 vThe 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$53 on Tuesday, a gain on recent sessions.
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/ Z1 f. q8 n. ] mMeanwhile, the Canadian dollar closed near the US81￠ level." V1 c; x! z: P
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The regional shift is also evident in the housing market, where the slowdown in Calgary and Edmonton helped pull down national sales by 3.1% in January from December and by 2% from a year earlier, the Canadian Real Estate Association said Tuesday.
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- e+ j2 k' }& x, B6 E# c“As expected, consumer confidence in the Prairies has declined and moved a number of potential homebuyers to the sidelines as a result,” CREA president Beth Crosbie said.6 F1 r$ |: w5 u
2 `) v0 ?- T% MTotal 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%.- ?% ]! m9 @7 o) Z0 F' J; {
3 v5 b9 {( B0 ^( i2 C3 I; ~“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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