Importantly, as investments in the oil patch are pared back, Canada’s growth slows. But, when those investment levels stop falling, Canada’s growth will pick up, even if oil sector investment does not, as other areas of growth come to dominate the data. Second, uncertainty about future trade policies has risen again in Canada.
We have seen subdued business investment in most sectors for the past two years, but were hopeful that the combination of the signing of CUSMA and the government’s Accelerated Investment Incentive would lead to a pickup in investment. While the overall effect remains to be seen, doubts about the ratification of CUSMA remain a downside risk to our investment outlook.