Conference Board mentions recession for Alberta, Prentice says no
A report by the Conference Board of Canada has sparked reaction from other economists and Alberta’s premier. The research organization suggests that the province could suffer more than just a slow down and that it could slip into recession. Alberta Premier Jim Prentice, speaking at a news conference in Edmonton
, disagreed. He said that, while forecasts show that economic growth will likely be curbed by declining oil revenues, it is not slip enough to trigger recession. ATB Financial economist Todd Hirsch concurred, adding that if the weak oil price was to stay long term then there could be trouble but the outlook is for things to recover in the longer term. While most agree that there will have to be some measures taken to offset the losses to provincial revenue and that unemployment may cut consumer spending, there is little expectation of recession.
Ottawa office sector set for shake-up
The office market in Ottawa
, which ended 2014 with a near-record high vacancy rate, is set for a shake up. That’s according to a new outlook from Colliers International, which says that the acquisition of almost half of the office space in the Ottawa
suburb of Kanata by KPR Properties is likely to be a game changer. Colliers’ managing director Kevin Holmes commented: “Having such a dominant player in this market could result in changes to rent rates and potentially shift tenants into and out from Kanata, which would affect other sub-markets as well.” Kanata may be looking healthy but other parts of the city are not faring so well; the Fringe Core and Downtown Core have both seen vacancy rates rising and rents falling.
No slowdown in household debt
While Canadians may be wary of the outlook for the economy, as shown by recent polls, it’s done little to dampen the appetite for debt. The Royal Bank of Canada says that household debt grew in November by an annualized rate of 4.5 per cent, marking a two-year high. Residential mortgages accounted for the biggest slice of the growth, rising 5.2 per cent, while other credit increased by three per cent. RBC predicts that the losses from the oil industry will balance out elsewhere, with exports increasing due to the weaker loonie and savings at the pumps being spent elsewhere or used to reduce debts.
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