-- of GDP and will remain around this level over the coming decade. Higher growth in private consumption and especially fixed investment during a period of higher oil prices has seen government consumption drop from -- to -- of GDP in recent years. ...However, the drop in oil prices has triggered a collapse in business investment in the energy sec- tor. Investment elsewhere in the economy remains too weak to make up the difference, since years of underinvestment in productive capacity, especially after the global financial crisis, and a multiyear appreciation of the exchange rate have left Canadian manufacturers highly uncompetitive. These dynamics will reverse over the coming years as exchange rate weakness and higher unemployment restore some of the competitiveness lost during the years of high commodity prices. ...Net Exports: Exports of goods and services will account for between -- and -- of GDP over the coming years, broadly in line with the historical trend. Imports of goods and services -- Business Monitor International Ltd www.bmiresearch.com
...Private consumption and goods export growth in Canada will offset the continuing decline in fixed investment and see real GDP growth accel- erate over the coming quarters. Strong demand for Canada s manufac- tured goods amid a gradual restoration of economic competitiveness through a weaker exchange rate will see investment in non-residential construction and machinery and equipment begin to drive overall fixed investment higher after ----. ...Private consumption and goods export growth in Canada will offset the continuing decline in fixed investment and see real GDP growth accel- erate over the coming quarters. Strong demand for Canada s manufac- tured goods amid a gradual restoration of economic competitiveness through a weaker exchange rate will see investment in non-residential construction and machinery and equipment begin to drive overall fixed investment higher after ----. A strengthening export performance and a steady expansion in household consumption will see the Canadian economy expand at an increasing rate over the coming quarters, offsetting the lingering negative effects of falling oil prices on fixed invest- ment. ...Our more conservative growth outlook for Canada can be put down to BMI s below-consensus oil price forecasts, which will see fixed investment recover at a slower pace than is widely anticipated. We forecast Brent crude to average USD--.-/bbl and USD--.-/bbl in ---- and ---- respectively, seeing no meaningful recovery in oil prices over the next two years (see Brent: Volatile H--- Will Pave The
...
