Economic outlook October 2019: Growth persists amid uncertainty

Published on: Oct 21, 2019

Despite ups and downs on the global front, Canadian growth was exceptionally strong in the second quarter of 2019. Overall, the country’s economic activity expanded by 3.7 percent—a welcome change from the two prior quarters of virtually no growth. But, with slower global growth and plenty of risks looming on the horizon, the key question is: will this pace of growth last?

This is one of the topics Deloitte Canada’s chief economist Craig Alexander explores in our fall 2019 quarterly economic outlook, entitled Growth persists amid uncertainty. Despite the slumping global manufacturing sector and overall escalation of geopolitical risks, particularly the US-China trade dispute and a disorderly Brexit, economic growth should persist, albeit at a modest pace both in Canada and around the world.

The possibility of a global downturn—one that would almost inevitably drag Canada into recession—looms large over the world economy, as demonstrated by the continued inversion of yield curves in advanced economies. However, a scenario whereby trade frictions are successfully resolved, sentiment improves, and risk-asset prices—including stocks and commodities—rise in anticipation of higher growth is not out of the question.


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