Canadian Cities to See Slow Growth as Inflation Continues
OTTAWA, Aug. 17, 2023 (GLOBE NEWSWIRE) — Canadian cities will see muted growth throughout the remainder of 2023 and into 2024 as inflation and higher interest rates persist, weighing down consumer activity according to new research from The Conference Board of Canada.
“Coast to coast, Canadian cities will largely be impacted by similar factors in the near future,” said Jane McIntyre, Principal Economist at The Conference Board of Canada. “Across many cities, local construction projects as well as international and domestic travel will generate a boost for the economies while households and businesses will continue to face headwinds.”
- Construction of Thunder Bay’s jail continues to lift the city’s economy even as Canada’s cools, with real GDP growth anticipated to reach 2.5 per cent in 2023 and 2.7 per cent in 2024.
- Various construction and manufacturing investments in Windsor are expected to benefit the region for many years, including a new battery plant, updates to Magna’s existing facility and The Gordie Howe International Bridge. These investments will play a key role in growing the region’s GDP by an anticipated 2.2 per cent in 2023 and a further 1.8 per cent in 2024.
- Volkswagen’s massive electric vehicle battery plant in St. Thomas will greatly benefit London, while excess savings over the last few years, combined with a tight labour market, have given households the confidence to continue spending on services in the region. GDP in London is forecast to grow 2.0 per cent in 2023 and 1.2 per cent in 2024.
- Intercity and international migration to Oshawa has been strong in recent years and is expected to boost the prospects in the region, as are the upgrades at the General Motors assembly plant. The city’s unemployment rate will slip slightly, but GDP is forecast to grow 1.8 per cent in 2023 and 1.9 per cent in 2024.
- Moncton is seeing strong population growth, in part due to international migration. Economic activity this year will be driven by growth in construction, manufacturing, public administration and healthcare which is anticipated to increase the city’s GDP by 1.7 per cent in 2023 and 0.7 per cent in 2024.
- Tourism in St. Catharines-Niagara has been robust and will help the region avoid a major recession this year. However, high interest rates and inflation are expected to slow consumer spending as GDP growth is forecast to grow 1.3 per cent in 2023 and 1.5 per cent in 2024.
- The delay in returning the Terra Nova oil platform to production, coupled with expected declines in oil production due to scheduled maintenance, will limit economic growth in St. John’s this year. GDP in the city is forecast to grow 0.8 per cent in 2023 and 1.7 per cent in 2024.
- After seeing strong growth over the past two years, Kingston’s economy is slowing as households and businesses will be challenged by inflation and rising interest rates. The city’s GDP is forecast to expand 1.3 per cent in both 2023 and 2024.
- Despite healthy population gains, Guelph’s economy will not escape the impacts of higher inflation and rising interest rates. The city’s GDP is expected to increase 1.0 per cent in 2023 and a further 1.4 per cent in 2024.
- Kitchener-Cambridge-Waterloo’s usually steady economic performance will slow in the face of rising interest rates, a cooling housing market and the potential of a recession. GDP is forecast to expand 0.9 per cent in 2023 and 2.0 per cent in 2024.
- A slowing national outlook will have local implications in Greater Sudbury, but strong demand for nickel to produce batteries for electric cars is nonetheless positive for the city’s economy, which is forecast to see GDP growth of 0.3 per cent in 2023 and 0.9 per cent in 2024.
The Conference Board of Canada
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