Canada's Economic Outlook: No Recession Yet, Says Expert Council
Too soon to declare a recession, says Canada's unofficial authority on calling them

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The C.D. Howe Institute's Business Cycle Council asserts that Canada is not in a recession despite two consecutive quarters of GDP decline. They emphasize that economic weakness is not widespread or persistent enough for such a declaration, urging caution in interpreting recent data.
- 01The C.D. Howe Institute's Business Cycle Council is regarded as the authority on recession calls in Canada.
- 02The council does not accept the common definition of a recession based on two consecutive quarters of GDP decline.
- 03Panel member Steven Ambler highlighted three criteria for declaring a recession: pronounced, persistent, and pervasive decline in economic activity.
- 04Recent GDP declines are not as severe as those in previous recessions declared by the council.
- 05Canada's unemployment rate decreased to 6.6% in May, indicating some positive employment trends.
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The C.D. Howe Institute's Business Cycle Council, Canada's unofficial authority on recession declarations, stated it is premature to label the economy as being in a recession. This follows Statistics Canada's report of two consecutive quarters of GDP decline, which some economists view as a technical recession. However, the council urges caution, arguing that the current economic weakness is neither widespread nor persistent enough to warrant such a label. Council member Steven Ambler explained that they assess three criteria—pronounced, persistent, and pervasive declines in economic activity—before declaring a recession. They noted that the recent GDP decline is not as significant as previous downturns that led to recession declarations. Additionally, the unemployment rate fell to 6.6% in May, marking the first notable employment gain since November, suggesting some resilience in the job market. The political debate continues, with the Conservative party blaming the Liberal government for the economic situation, while Prime Minister Mark Carney anticipates uneven growth as efforts are made to reduce reliance on the U.S. economy.
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The debate over recession impacts economic policy and public perception, influencing government actions and public confidence.
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