Budget watchdog slashes economic growth projections, blames temporary factors
OTTAWA — Canada’s budget watchdog says economic growth during the final quarter of 2019 will be “significantly weaker” than predicted in its fall report.
In its latest report on near-term growth, the parliamentary budget office says real GDP growth in the final three months of last year will likely come in at near-stagnant levels, at an annual rate of 0.3 per cent.
That’s down from the PBO’s November prediction of 1.6 per cent growth in the fourth quarter.
Parliamentary budget officer Yves Giroux blames the weakness mainly on what he describes as temporary disruptions in the mining, oil and gas, motor vehicle and rail transportation sectors.
His report today projects real annual GDP to grow of 1.5 per cent in the first quarter of 2020, which is also slower than previously projected, partly as a result of weaker business investment and the economic effects of the coronavirus outbreak.
The report also predicts the federal budgetary deficit for fiscal year 2019-20 will reach $23.5 billion — roughly 10 per cent higher than projected in November — as new government spending measures come into effect.