• The latest indicators show the world economy off to a robust start in 2010 and point to continuing vigour. Beijing has begun to rein in Chinese credit expansion in response to surprisingly strong growth and soaring imports and exports.
  • Despite a disappointing December employment report, the U.S. economy is headed in the right direction. Consumers have entered a virtuous circle of deleveraging, in which a savings rate in the neighbourhood of 5% allows growth in consumer spending in tandem with reduction of household debt. We continue to expect U.S. growth of 3.4% in 2010.
  • Canada is well ahead of the U.S. in the recovery of its labour market. Jobs in services rose to an all-time high in December and the aggregate wage bill showed strong growth in Q4, confirming that domestic demand will have legs. We are raising our forecast of Canadian growth to 3.1% in 2010.