Canada’s banks are predicting the worst recession since the 1960s due to the coronavirus outbreak.
Economists at the Bank of Montrea (T.BMO), Bank of Nova Scotia (T.BNS) and Toronto-Dominion Bank (T.TD) are forecasting that Canada’s economy is likely to shrink by 10% to 24% in the second quarter on an annualized basis. That would represent the largest quarterly decline in Canada since the early 1960s, when comparable data began to be recorded.
If accurate, the second quarter decline would be much worse than the current record of negative 8.7% economic growth experienced during the 2008-09 financial crisis.
Economists are also predicting that Canada’s unemployment rate will rise as high as 10% in coming months. Until a month ago, the unemployment rate was below 6%, close to all-time lows. But last week, half a million jobless claims were filed representing 2.5% of the labour force.
