The leading indicator index for Canada continues to grow at a moderate pace. Since last May, the index trend announces a compression of economic growth, and January results, published today by Statistics Canada (SC), are no exception. The manufacturing sector components of the index contribute significantly to its slow pace of growth, but that sector could benefit from the acceleration of the expansion in the United States in 2011, although this is not yet visible in the manufacturers book orders for which data were also released today by SC.
The growth outlook for Canada in 2011 reflects well the recent evolution of the leading indicator index. The IMF forecasts economic growth of 2.3% in Canada this year, compared to 2.9% in 2010. The Bank of Canada forecast is at 2.4%, with a slight acceleration of the pace of growth at mid-year. The Economist pool of forecasters has estimates of GDP growth for Canada ranging from a low of 2.0% to a high of 3.2%, the average being 2.6%.
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