bravo festival condos prices.Canada’s economic recession in 2023! Economists at Desjardins predict that Canada is expected to enter a recession in the first half of 2023 as the outlook for Canada is also dragged down by aggressive interest rate hikes, a cooling housing market and weak growth in the United States.Please Visit: bravo festival condos prices to Get Your VVIP Registration Today!
In a report released on Thursday, economists at Desjardins said it was “not easy” to pull soaring inflation back to the 2 per cent range and that a soft landing had become “increasingly unlikely”.
“the Canadian economy, like many other countries, seems to be entering a slight downturn and should reach a trough in early 2023,” Chief Economist Jimmy Jean, Canada’s senior economic director Randall Bartless, and Chief Economist Hendrix Vachon wrote in a research note. In our view, this decline is a necessary and painful process because it helps to offset some inflationary imbalances. ”
“We now expect the Canadian economy to fall into a mild recession in the first half of 2023.”
Although Canada’s inflation rate slowed to 7.6% in July, the Bank of Canada has said it is necessary to continue to raise interest rates to curb soaring inflation. The central bank has been aggressively raising interest rates since March, most recently by 100 basis points, bringing the key interest rate to 2.5 per cent.
Economists who point out that the benchmark interest rate is expected to reach at least 3.25% this fall will put further pressure on the Canadian real estate market and drag on household spending and business investment, with real GDP contracting slightly in early 2023.
But the most important drag on economic growth is the cooling of the real estate market. Economists point out that since peaking in February, home sales across the country have fallen by 31% and prices have fallen by 17%. In a separate note to customers, Jean said that the adjustment in the housing market and the spillover effect on domestic demand will lead to two consecutive quarters of GDP contraction early next year.
“We expect the housing market to continue to cool for a few more quarters, which should drive down housing investment until the end of 2023.”
“this will be a major drag on Canada’s prospects.”
As growth slows, economists warn that the job market will weaken and could push up the unemployment rate. However, they also point out that as the job market starts from a strong position and labour shortages reach record levels, the rise in unemployment may be lower than expected. The high savings rate among Canadian households will also ensure the livelihood of the family.
Nevertheless, economists point out that a soft landing is more unrealistic than a “short-term and shallow” recession, but “if we do not respond to high inflation, it will be more detrimental to economic growth in the long run.”
“the recession of 2023 may not be good news, but it should help avoid a more painful outcome. It could also lay the groundwork for stronger growth in 2024, accompanied by lower and more stable inflation.”