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Country Economic Forecasts > Canada

  • May 2017
  • 13 pages
  • Oxford Economics
Report ID: 1907530

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Real GDP was flat in February after a strong 0.6% gain in January. With two months in the books, the economy appears to have made a strong start to 2017; we estimate it grew by nearly 4% annualized in Q1. This strength means that growth is likely to average around 2.5% in 2017 as a whole, firmer than the 1.4% pace recorded in 2016. However, we think Q1 growth overstates the underlying pace of growth in the economy. Indeed, downbeat core inflationary pressures, only up around 1.5% y/y in March, point to persistent excess economic slack. Furthermore, considerable uncertainties - in particular, worries about a protectionist US trade policy - could generate headwinds for economic activity.

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