Canada’s real gross domestic project will grow 5.1% this year, down from an earlier forecast of 6.1% growth, The Conference Board of Canada reported. The decreased forecast reflects the 0.3% decline in GDP during the second quarter that was driven by a decrease in real exports.
Looking ahead, the organization forecast 4.4% growth in GDP for 2022 and growth of between 1.6% and 1.7% in 2023.
“The unprecedented levels of pandemic stimulus measures are easing as social distancing restrictions have largely lifted across Canada, but the debt overhang remains a long-term issue,” said Ted Mallett, director, economic forecasting at The Conference Board of Canada.
“These critical income measures led to a federal deficit of $228 billion in 2020,” Mallett said. “While a rebound in revenues, as well as the easing of some major support measures, led to an improvement in the deficit this year, the federal government has added massively to its debt in just two years.”