(MENAFNEditorial)
Core Views
* The sharp drop in oil prices will prolong Canada's economic rebalancing by weighing on fixed investment growth over the few years.
* The current account deficit will narrow as strong US demand and a weaker exchange rate boost non-commodity exports in the coming years.
* The 2015 general federal election will be a very close one after the Conservatives have succeeded in halting their slide in opinion polls.
Key Forecast Changes
* We have lower our real GDP growth forecast for Canada to 2.1% in 2015 down from 2.3% and see slightly lower growth in 2016 (2.3% versus 2.4% previously).
* We have changed our current account deficit forecast for 2015 to 1.5% of GDP from 2.2% as robust US demand for crude oil has seen Canada's trade in goods balance move into a sizeable surplus in 2014.
* We have lowered our end-2015 policy rate expectations amid softer economic growth and continued dovish rhetoric from the Bank of Canada. We now see only a 25bps hike to the overnight rate in late 2015 to 1.25% versus our previous forecast of 1.50%.
Full Report Details at
- http://www.fastmr.com/prod/951883_canada_country_risk_report_q2_2015.aspx?afid=101
Key Risks To Outlook
* Despite our economic growth forecast revisions we may be understating the near-term risks stemming from the collapse in oil prices and the sell-off in the Canadian dollar since June 2014.
* Looking further ahead we continue to cite high household debt (97% of GDP) as a major source of uncertainty for the Canadian economy which could lead to a sharp drop in household spending and business investment at some point in the future.
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The Canada Country Risk Report helps businesses with market assessment strategic planning and decision making to promote growth and profitability in Canada. It is an essential tool for CEOs Chairmen Finance Directors/CFOs Managing Directors Marketing/Sales Directors with commercial interests in this emerging market.
An influential new analysis of Canada's economic political and financial prospects through end-2019 just published by award-winning forecasters Business Monitor International (BMI).
Key Uses
* Forecast the pace and stability of Canada's economic and industry growth through end-2019.
* Identify and evaluate adverse political and economic trends to facilitate risk mitigation.
* Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
* Contextualise Canada's country risks against regional peers using BMI's country comparative Risk Index system.
* Evaluate external threats to doing business in Canada including currency volatility the commodity price boom and protectionist policies.
The Canada Country Risk Report by Business Monitor International (BMI) includes four major sections:Economic OutlookPolitical OutlookOperational RiskandKey Sector Outlook.
Economic Outlook:
How will the Canada' economic policy-making and performance impact on corporate profitability over 2015-2019?
BMI provides our fully independent 5-year forecasts for Canada through end-2019 for more than 50 economic and key industry indicators. We evaluate growth and also forecast the impact of economic management.
Economic Outlook Contents
The Canada Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019 set against government views and BMI's evaluation of global and regional prospects.
Key Areas Covered:
Data:
* Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita) population inflation current account balance and the exchange rate.
* BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk and rates the business environment within a global and regional context.
Written Analysis:
* Economic Activity - real GDP growth employment inflation consumption (retail sales and confidence).
* Balance of Payments - trade and investment current and capital account.
* Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
* Exchange Rate Policy - currency controls foreign investment flows exchange rates and foreign exchange reserves.
* Fiscal Policy - macroeconomic strategy and policies government finance and tax reforms.
* Foreign Direct Investment - approvals inflows and climate.
* External Debt - debt profile (short and long-term plus public and private sector obligations).
* Global Assumptions - forecasts for each year to end-2019 covering: major commodities growth in key regions inflation and interest and exchange rates in the United States Japan China and the eurozone.
Key Benefits
* Rely upon BMI's 100% independent forecast scenarios for Canada and underlying assumptions - we take no advertising and are privately-owned.
* Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Canada sourced and fully maintained by BMI from an extensive network of private sector government and multilateral contacts.
* Gain key insights into the current and future direction of government economic policy which could significantly affect your company's business prospects from BMI's team of analysts and economists.
Political Outlook:
What are the political risks to doing business in Canada over the next 5-years?
BMI's Canada country Risk Index evaluates the short- and medium-term threats to political stability.
Political Outlook Contents
* SWOT Analysis for the Canada Market - Political Strengths Weaknesses Opportunities and Threats facing Canada.
* Political Stability and Risk Assessment - BMI's Risk Index assesses explicit short- and long-term risks to political stability; latest positioning and trends for Canada's risk are compared with regional and global averages.
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