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Canada Sees Faster Recovery Than in Past Recessions

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Blog by Scott Williams | January 22nd, 2009

By Greg Quinn

Jan. 22 (Bloomberg) -- The Bank of Canada said the economy will recover from a recession this year more quickly than in the past as credit markets and exports rebound, a view that economists said may be too optimistic.

The central bank slashed its economic growth forecast for the first quarter, saying output will shrink at a 4.8 percent annualized pace after predicting in October that it would be unchanged. Gross domestic product will shrink at a 1 percent rate in the second quarter before growing 3.8 percent next year, almost double the median pace in a Bloomberg survey of economists.

“The projected return to balance of the Canadian economy is faster than either of the recoveries following the 1981-82 and 1990-92 recessions,” the Ottawa-based central bank said today in an update to its October Monetary Policy Report. “Canadian credit conditions remain better than those in other major countries” and “exports are also expected to recover next year,” the bank said.  Read More