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Alberta will sink into recession this year, as provincial fortunes turn amid oil’s collapse, CIBC predicts
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. P9 x' K! r$ Q4 ?7 Y, a" xRepublish Reprint
+ ?. j/ `: G0 x0 _Gordon Isfeld | February 17, 2015 | Last Updated: Feb 17 6:00 PM ET
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4 {9 o3 a/ Y# vLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.
8 b2 O: j" E, S( B' kBloombergLast year Alberta lead Canada's growth, but the plunge in oil prices has turned the tables on the nation's energy giants.
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L& R8 b8 l' L$ e: O6 zOTTAWA — Consistently low oil prices could dramatically alter the economic landscape of Canada in the coming year and beyond, with Alberta slipping into a “mild” recession as a weak dollar helps lift the manufacturing hubs such as Ontario.
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8 Z: ?6 Y3 k$ K0 ^That pattern is already being reflected in a slowdown in the oil patch-fueled housing market in Calgary and Edmonton, in addition to an anticipated knock-on increase in unemployment rates in the province.
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& ?3 B- I. I; W: K3 iIn a report released Tuesday, titled The Tables Have Turned, economists at CIBC World Markets said recent data show “just how sharply the growth leadership is likely to swing.”* t8 K& a/ h$ L. j0 ?) f: {# P4 \
' S* x: e+ @/ N' H6 p9 nMost startling, perhaps, is the likelihood Alberta will go from the leading economic power house in 2014 to recessionary levels this year.
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“Alberta looks headed for a mild and temporary recession,” said economists Avery Shenfeld and Nick Exarhos, pointing to a 0.3% decline in 2015, compared with 4.1% growth in 2014.' P( C' ~$ ]/ n; o# m* ]+ ]* r
% z- n- D; E" ^5 ?! V3 |) @4 ^As well, they see growth in Saskatchewan — the country’s other major resources-heavy province — suffering in 2015, managing an advance of only 0.8% this year, after 1% in 2014, but likely avoiding an outright downturn. G# U9 u- _4 S9 S9 B) @3 y. ?) \
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However, Newfoundland and Labrador — also reliant on energy revenues — could contract more significantly this year, by 1.3%, and in 2016, by 1%.+ Y- ?( K& L( k
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In contrast, Central Canada “should enjoy a small upside surprise,” thanks mainly to a healthy U.S. economy, CIBC predicts, along with a lift in exports from a weak Canadian dollar.: d. I1 j/ b) u/ [9 z& o8 t8 H
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Canada’s oil capitals are headed for their first major housing correction since 2008, TD warns
' @- T: m* ~+ p6 |) vCenovus Energy Inc slashes staff by 15%, freezes pay in ‘challenging times for oil and gas industry’& z$ T$ c& A1 H/ q$ s; s& l0 `
The best oil traders in the business say this rout is not over
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# D. d& Y" V6 L# \; S1 e( M8 X9 jThe Ontario economy will expand 2.8% this year, up from 2.1% in 2014, and add 2.8% next year, according to CIBC. Quebec should add 2.4% this year and 2.6% in 2016, after a restrained advance of 1.8% in 2014, the bank said. At the same time, British Columbia will continue its mid-2% growth trend.
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“That will translate into commensurate shifts in the employment picture, alleviating pressure in some areas — where, if anything, workers are currently in scarce supply — and lowering the jobless rate in Central Canada, where it has been stuck above the national average.”3 T& A: R9 r9 N( M! W) }6 _+ o
0 R/ ^ V& _# t& B4 N8 mFor example, Alberta’s jobless rate could rise to an average of 6.8% this year, from 4.7% in 2014, the CIBC said, while Ontario should see its unemployment level fall to 6.6% from 7.2% last year.
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4 g; O7 a) B5 M7 g. }CIBC expects overall growth in Canada to be around 1.9% this year, down from 2.4% in 2014, and rising by 2.5% next year.; ~3 N+ B( n' \7 z9 _
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Contrast those with the Bank of Canada’s 2.1% outlook for this year and 2.4% in 2016 issued in January, when policymakers surprised markets by cutting their benchmark lending rate to 0.75% from 1%, where it had stood since September 2010.! j! |8 ?1 V0 g+ g4 ?& M. h' h3 D* S
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The central bank’s GDP forecast is based on an average oil price of US$60 a barrel in 2015 and 2016. Crude was trading above US$53 on Tuesday, a gain on recent sessions.
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Meanwhile, the Canadian dollar closed near the US81￠ level.
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The regional shift is also evident in the housing market, where the slowdown in Calgary and Edmonton helped pull down national sales by 3.1% in January from December and by 2% from a year earlier, the Canadian Real Estate Association said Tuesday.
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! p* ]2 ?$ k6 ^4 s“As expected, consumer confidence in the Prairies has declined and moved a number of potential homebuyers to the sidelines as a result,” CREA president Beth Crosbie said.
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8 l% [8 u8 |. x$ dTotal January residential sales in Calgary were down 35.5% from a year earlier, while Edmonton fell 22.7%, Saskatoon lost 24% and Regina was off 6.9%.
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; b- P1 d( n [4 p. X6 g6 I“There’s little mystery behind the sudden reversal of fortune for the national figures, as sales in Calgary and Edmonton — and Saskatoon — fell more than 20% from a year ago, in what had been the hottest markets in the country,” said Douglas Porter, chief economist at BMO Capital Markets. |
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发表于 2015-2-1 17:34
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