Curious how the vaccine news will contribute to economic recovery in 2021? Discover below. TEC Canada is pleased to provide the Andersen Monthly Economic Report exclusively to our members. The former assistant chief of the Bank of Canada’s research department, Dr. Peter Andersen provides valuable economic insight to help you make better business decisions.
- The recovery in Canada’s economy from the 1st virus wave was much stronger than thought possible – retail sales volumes recorded 5 consecutive monthly gains through September, though that will level out in the coming months.
- Manufacturing employment has already recovered to late 2019 levels – the slowdown in activity in the current 2nd wave will be mainly in the service sector.
- The housing sector is booming – new house prices have defied previous forecasts of a 2020 crash. The focus is now on low-rise housing and remodeling and renovation.
- As the pandemic gets under control, there won’t be a need to seek the U.S. dollar as a safe haven, leading to a major decline in the U.S. dollar in 2021 and 2022. This will give U.S. manufacturers a competitive edge against imports.
- The personal savings rate is still exceptionally high at 13.6% of personal disposable income, meaning American consumers have plenty of future spending power.
- Commodities: By mid-year 2021, expect to see more pressure on supply, more shortages and more price increases.
- The world economy faces an economic re-acceleration and recovery that should stretch for several years.
- Oil futures have increased to their highest level in nearly 8 months. Brent crude has doubled since April at $48/barrel.
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