2018 - 2022 FINAL Financial Plan (interactive version)

ECONOMIC OVERVIEW

President Trump imposed a 30% tariff on imported solar panel technology and washing machines in January of this year to protect domestic manufacturers. China has been accused by the President of unfair trade practices. This tariff could be the start of a more aggressive stance against China which may trigger countering Chinese tariffs and further strain relations between the two countries. Global financial markets would experience dire consequences if the two largest global economies descended into a trade war.

Source: Bank of Canada

CANADA The Bank of Canada (BOC) is forecasting national GDP growth of 2.2% in 2018. Alberta, British Columbia, Saskatchewan and Ontario are expected to lead the way with anticipated GDP increases of 2% or better for the year. The unemployment rate is forecasted to hover around 6%. An improving global economy has boosted business confidence and improved business investment. Government spending on infrastructure, social housing and education will further support economic growth. The BOC increased its key interest rate to 1.25% this January. The central bank has raised its rate three times since last summer due to broad based growth across various regions and industries. Although the economic outlook remains positive, the BOC reiterated that it will be cautious in its approach to future rate hikes as consumers’ sensitivity to rising interest rates, and the corresponding impact on the economy, needs to be monitored. The central bank maintains that future decisions will be data dependent and guided by wage growth and inflation data. With strong economic growth and employment gains in the outlook, analysts are expecting the BOC to raise its key interest rate twice more this year.

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2018-2022 Financial Plan

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