Ontario's economic growth to pick up the pace in 2013: RBC Economics
TORONTO, June 19, 2013 /CNW/ - Ontario's economic growth is expected to
improve this year and next, due to employment gains, improving trade
performance and still-strong housing construction at the start of 2013,
according to the latest RBC Economics Provincial Outlook issued today. RBC
anticipates real GDP growth of 1.7 per cent in 2013 and 2.8 per cent in 2014,
both up from 1.5 per cent in 2012.
Ontario's growth was re-energized in the early stages of 2013 after stalling
in the second half of 2012. RBC indicates that Ontario's international trade
deficit decreased slightly, bucking the decade-long deteriorating trend and
reducing its drag on economic growth, and the jobs market experienced
"We saw a jaw-dropping 51,000 surge in employment gains in May as well as
year-to-date annual job growth jumping to 2.0 per cent, more than double the
increase in 2012," said Craig Wright, senior vice-president and chief
economist, RBC. "These encouraging developments should go a long way in
convincing skeptics that Ontario's economic engine has restarted."
On the external trade front, RBC notes that in the first four months of 2013,
exports grew 0.5 per cent, despite momentary fatigue in motor vehicles and
parts - Ontario's top exports - which last year recorded a significant 17 per
cent increase. With U.S. auto sales in the midst of a solid recovery, RBC
anticipates there is scope for further gains in auto sector exports.
"Generally speaking, the U.S. economy is on an uptick, which bodes well for
Ontario's economy. We expect U.S. demand for the province's goods and services
to improve in the period ahead," said Wright.
In early 2013, the number of homes (or, more specifically, condos) under
construction in Ontario were near 30-year highs, and residential investment
remained a factor adding to growth. Nonetheless, RBC expects residential
construction activity to slow later this year as sales and starts decline and
homes under construction are completed.
"While we anticipate slowing residential construction activity will leave a
hole in the province's economic accounts, strong investment in non-residential
structures and infrastructures will more than fill it up," said Wright.
The RBC Economics Provincial Outlook assesses the provinces according to
economic growth, employment growth, unemployment rates, retail sales, housing
starts and consumer price indices. The full report and provincial details are
available online as of 8 a.m. ET today at
Craig Wright, RBC Economic Research, 416 974-7457 Robert Hogue, RBC Economic
Research, 416 974-6192 Elyse Lalonde, RBC Corporate Communications, 416
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NI: FIN ECO ECOSURV
-0- Jun/19/2013 09:00 GMT
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