Canada’s economy emerges leader among G-7 IN 2010 and 2011

Canada, 3rd May: Canadian economy has emerged as the fastest among the G-7 for the year 2010 and 2011.

By doing so, it has eventually proved the predictions made by the IMF (International Monetary Fund) earlier this month quite true.

The IMF in its World Economic Outlook report had said that the economy of Canada will be equivalent to the growth of the US in 2010 and will exceed it in the year 2011.

The reason cited for strong economic development of Canada, as per the report, is the sound shape of Canada when it entered global economic crisis. Hence, the report added that the exit appears to be far less challenging for Canada than any other nation.

Canadian economy grew 0.6 percent in January 2010, which is being stated to be the fastest rate of growth in the last three years with most growth seen in construction, manufacturing and wholesale sectors, Statistics Canada figures reveal. 

In February, the economy of Canada grew for a sixth month consecutively due to spending and manufacturing relating to Olympics games in Vancouver. 

As per the forecasts, the economy of Canada will grow at the rate of 2.6 percent in 2010 and go even further high to 3.6 percent in the year 2011 while the economy of its southern trading partner United States will see a growth rate of 3.1 percent and 3.2 percent for 2010 and 2011 respectively.

Increase in Canada’s growth rate is reflected in the rise of the Canadian dollar against that of US dollar with former gaining 0.6 percent on bets regarding likelihood of increase in interest rates by Bank of Canada.

The lending rate in Canada touched the record low of 0.25 percent in April and Bank of Canada is likely to consider introducing a hike in the lending rates after July 2010.

Meanwhile, any decision to introduce stricter monetary policy depends entirely on inflation as well as future growth of Canadian economy, Bank of Canada’s Governor Mark Carney clarified.

Hence, the best thing is to adopt the wait-and-watch policy, Carney added. He had stated last week that 5.8 percent annualized rate at which Canada’s economy had expanded in the first three months this year is the fastest rate in the last decade.