This report presents a mid-year update of our long-term national economic outlook.
Canadian Long-Term Outlook Summary: COVID-19 Hurts Badly Now, But Will Not Last Forever
Canadian Long-Term Outlook Summary: COVID-19 Hurts Badly Now, But Will Not Last Forever
Canadian Economic Analysis
$735.00
- Fallout from COVID-19 will produce a 4.3 per cent GDP decline in 2020, but we expect a bounce-back to 6.1 per cent growth next year. GDP will advance by an annual average of 1.7 per cent between 2022 and 2040.
- Employment will drop 2.7 per cent this year but rebound by 3.1 per cent in 2021. Annual job gains will average less than 1 per cent over the long term.
- Consumption will fall 4.1 per cent this year but rise 5.9 per cent in 2021. Due to high levels of household debt, only tepid growth is in the cards over the long run.
- Trade is another casualty of the pandemic. Exports will fall sharply this year and not regain pre-COVID-19 levels until 2023 due to soft global growth and ongoing trade tensions.
- Business investment has been weak and will erode further after a post-COVID-19 rebound in 2021 and 2022.
- Economic malaise has prompted the Bank of Canada to cut interest rates to near zero. We expect muted inflation to keep rates low through the long term.
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