This quarterly economic forecast presents the medium-term outlook for the Canadian economy. This release focuses on household consumption. For an overview of all major components of the economy, go to the Canadian Outlook main page.
Documents Highlights
- Household spending had recovered fully by the third quarter of 2020, thanks to pent-up consumer demand for goods and to the staggering levels of income support from the federal government.
- Consumption of services, especially travel and recreation services, will remain subdued in the first half of 2021, held back by restrictions aimed at fighting the second wave of the pandemic.
- After an unprecedented drop of 6.4 per cent last year, real household consumption is expected to increase by 4.6 per cent in 2021 and 5.2 per cent in 2022. A full recovery to pre-pandemic levels is not expected until early next year.
- Household savings soared in 2020, suggesting that consumers have lots of spending capacity but have been cautious about spending amid the pandemic. We expect the savings rate to fall starting in the third quarter of this year as spending on services begins to pick up.
- Several goods-spending categories reached their all-time high in the third quarter of last year, but growth will slow down in the coming quarters as both income support programs and pent-up demand start to wane.
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