Benjamin Tal’s Economic Buzz Fall 2011!

Here is a look at what Benjamin Tal, Deputy Chief Economist has to say about our current economy in Canada.

“Accidents can happen to any economy. Temporary troubles in energy and autos hit

exports hard during the second quarter, which was enough to push Canada’s Gross Domestic Product (the size of our economy with inflation factored in) into a decline—even though demand was healthy at home.”

“This made the quarter look worse than it really was, and a rebound is therefore likely in the third quarter. Indeed, June’s monthly data showed a decent 0.2% gain as a signpost of an upward trend. Aside from January’s strong growth, Canada’s GDP has been essentially flat for five months.”

“Flat economies don’t inevitably signal a recession—both Canada and the US have gone through many extended flat stretches which were followed by growth. However, with the US economy so fragile, it won’t take much of a miss to find the US and then Canada in recession or something close to it. Plus, there are enough clouds on the global horizon to be concerned about the next several months.”

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