Canada’s economic performance in 2021 is forecast to lag the United States for the fourth consecutive year.
Economists revised their growth estimates for Canada higher this year, although the recovery from COVID-19 is expected to lag the U.S.
Canada’s economy is expected to expand 4.7% in 2021, according to Bloomberg News’ latest monthly survey of analysts. That’s up from a previous yearly estimate of 4.4%. Growth in 2022 is now seen at 4.1%, little changed from the January survey.
The upward revision reflects what has been a more upbeat outlook in recent weeks. The global vaccine rollout, rising commodity prices that favour Canada, and potential impacts from more fiscal stimulus in the U.S. are driving the more optimistic forecasts among economists.
However, economists have upgraded U.S. growth for this year by even more than in Canada, seeing it at 4.9% in 2021 versus an estimate of 4.1% only a month ago. If the projections prove right, the U.S. will outperform Canada for a fourth straight year.
Canada’s economy is estimated to have contracted by 5.4% in 2020, versus a decline of 3.5% in the United States.
