3 Dec 2015
Canada to piggyback US domestic performance - Scotiabank
FXStreet (Guatemala) - Analysts at Scotiabank explained that Canada should continue to piggyback on the momentum in U.S. domestic demand, with non-resource manufacturing and service exports getting an added boost from a more competitively valued Canadian dollar.
Key Quotes:
"The Canadian economy should also receive a boost from the increased spending provided by Ottawa's newly elected federal government, though the additional infrastructure expenditures promised are likely to have a greater impact in 2017. The impact of the new expenditures initiatives, however, will be lessened with upper income earners facing higher personal income taxes, and businesses likely facing higher environmental costs, both of which could reinforce a less buoyant trend in household and business spending.
Accordingly, Canadian output growth should continue to gradually build some momentum, with a stronger growth cycle largely dependent upon a renewed upswing in commodity prices and resource-related investments, and the anticipated improvement in the U.S. economy’s performance."
Key Quotes:
"The Canadian economy should also receive a boost from the increased spending provided by Ottawa's newly elected federal government, though the additional infrastructure expenditures promised are likely to have a greater impact in 2017. The impact of the new expenditures initiatives, however, will be lessened with upper income earners facing higher personal income taxes, and businesses likely facing higher environmental costs, both of which could reinforce a less buoyant trend in household and business spending.
Accordingly, Canadian output growth should continue to gradually build some momentum, with a stronger growth cycle largely dependent upon a renewed upswing in commodity prices and resource-related investments, and the anticipated improvement in the U.S. economy’s performance."