OTTAWA – Royal Bank says the Canadian economy is primed for a big bounce-back year in 2014.
One of Canada’s biggest banks says in a new forecast that the economy is due for a 2.6 per expansion next year, following two sub-par years of 1.7 per cent growth.
RBC’s call is significantly above the consensus among economists and the Bank of Canada, who also see the economy moving toward above-potential growth next year but at a more modest 2.3 or 2.4 per cent clip.
Two other forecasting houses also came out Thursday with consensus-like projections.
IHS Global Insight expects Canada’s gross domestic product to advance by 2.4 per cent in 2014, while the Canadian Chamber of Commerce is pencilling in a 2.3 per cent gain.
All three cite similar reasons for the improvement — renewed strength in the United States resulting in increased demand for Canadian exports, which the past two years have been the weak link in the Canadian economy.
RBC is also relatively optimistic about the strength of the Canadian domestic economy.
The bank’s analysts don’t believe, as some others do, that the Canadian housing market will suffer a setback in 2014, reasoning that rising incomes and improving household finances will support housing and consumer spending.