For these reasons, the Bank of Canada expects that the Canadian economy will gain momentum through 2002. After growing modestly in the first half - by 1 to 2 per cent, on an annualized basis - it should accelerate in the second half - to something like 3 to 4 per cent - and strengthen further in 2003.
Once our economy starts expanding at rates exceeding the growth of potential output later this year, the considerable amount of slack that has built up over the past several months will begin to be absorbed. Still, it could be late 2003 before the actual level of output in the Canadian economy will again reach its potential level.