the north face ice jacket Here are the top 4 risks facing Canada

the north face gore-tex Here are the top 4 risks facing Canada

While the Bank sees some hope for a pick up in Canadian growth later this year, risks remain. private demand”The major upside risk to inflation in Canada is stronger than expected private demand in the United States. housing market, and in the economy more generally, could generate stronger growth in labour income. Moreover, higher prices for housing and equities could cause household deleveraging to end sooner than expected. private demand. real GDP would more than offset the pressure on rates. Stronger demand in the United States would be transmitted to the Canadian economy through the trade channel andhigher commodity prices.”Euro area crisis”Failure to contain the crisis in Europe remains the most serious downside risk facing the global and Canadian economies. credit spreads to widen and equity prices to fall. demand and financial market turbulence would have significant consequences for our exports and for domestic economic activity. Even if the situation in the euro area remains contained, weakness could persist longer than projected, owing to reform fatigue, persistently high unemployment, and delays in the necessary institutional reforms and balance sheet repairs. There is also a risk that the current slowdown in economic activity in other EMEs could be more severe and protracted than the Bank has projected. In particular, the anticipated normalization of monetary policy in the United States could trigger larger capital outflows, tighter credit conditions and increased volatility in EME asset prices. Important structural reforms, which are necessary to expand potential growth, could also be delayed. The shock would be transmitted to the Canadian economy through weaker export sales, lower commodity prices and a deterioration in our terms of trade.”Disorderly unwinding of household sector imbalances”The elevated level of household debt and imbalances in some segments of the housing market remain the most important domestic source of risk to the Canadian economy. In the past several months, there has been a constructive evolution of household sector imbalances. Nevertheless, despite the continued slowing in credit growth, the level of debt remains high. In addition, some of the latest data point to the risk of renewed momentum in the housing market in the context of continuing very low borrowing rates. This renewed momentum would produce a temporary boost to economic activity and inflation, but more importantly, it would exacerbate existing imbalances and thereforeincrease the probability of a more severe correction later on. Such a correction could have sizable spillover effects to other parts of the economy.”
the north face ice jacket Here are the top 4 risks facing Canada