BMO Economics: Alberta Remains Near Top of Growth Leaderboard
- Energy sector remains critical driver of growth
- Jobless rate is lowest in Canada
- Real GDP growth of 2.7 per cent expected in 2013 (Canada's expected
to be 1.7 per cent)
CALGARY, ALBERTA -- (Marketwire) -- 01/17/13 -- Alberta's economy
continues to sit near the top of the Canadian growth leaderboard,
according to the Provincial Monitor report released today by BMO
Economics. Growth of 2.7 per cent is expected for 2013.
"The energy sector remains the critical driver of economic activity
in the province, and crude bitumen production was up a solid 17 per
cent year-over-year through October," said Robert Kavcic, Senior
Economist, BMO Capital Markets. "However, there are some mounting
risks in the sector. Cost pressures could again pick up, though oil
sands operations are generally viewed as economical at prices above
$80. A large risk is lack of progress on new pipeline capacity to
carry Alberta crude to markets in Asia and/or the U.S. In the
meantime, surging U.S. Bakken production has also contributed to a
wider discount received by Canadian producers relative to WTI."
Labour market trends, while still favourable, have ebbed from strong
performances in recent years. "Private-sector job growth cooled to
3.5 per cent in 2012 from 6.5 per cent in the prior year, with
manufacturing and trade gearing down," noted Mr. Kavcic.
"Public-sector job growth jumped 3.6 per cent, which might not be
sustainable given a mounting budget challenge."
"Businesses in the private sector continue to support Alberta's
economic growth by making important strategic investments and
expanding into new markets," said Mike Darling, District Vice
President, Commercial, Southern Alberta, BMO Bank of Montreal. "Our
BMO Confidence Report shows that Albertan entrepreneurs have a
positive outlook, with 70 per cent saying 2013 will be a better year
and the majority expecting their business will experience growth in
the year ahead."
Housing market activity is improving thanks to rising demand and a
gradual drawdown of the excess supply put up during the 2005-2007
boom. "In Calgary, the average home transaction price was up 8.6 per
cent year-over-year in December as the market balance has again
tilted in favour of sellers," said Mr. Kavcic.
The Province of Alberta reported weaker-than-expected financial
results for the first half of fiscal 2012-2013. The deficit over the
first 6 months of the fiscal year sat at $1.3 billion, larger than
the $777 million expected over that period in the fiscal 2012-2013
budget, and the Province continues to point to a full-year shortfall
in the $2.3 billion-to-$3 billion range.
The full Provincial Monitor can be downloaded at
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a
highly diversified North American financial services organization.
With total assets of $525 billion as at October 31, 2012, and more
than 46,000 employees, BMO Financial Group provides a broad range of
retail banking, wealth management and investment banking products and
Laurie Grant, Vancouver
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