• The unprecedented scope of government programs put in place earlier this year to fend off the credit crisis has helped stabilize the global economy. At this juncture, we believe the ample liquidity still being provided by central banks and governments in various parts of the world will make for a sustainable recovery.
  • The U.S. economic backdrop has improved markedly in recent months, so much so that GDP is poised to expand in the third quarter as firms start rebuilding inventories. With home prices stabilizing and the wage bill no longer shrinking, a sustainable recovery appears likely.
  • Accommodative monetary policy has had a strong effect on the housing market and relatively easy access to credit has fostered a comeback of consumer spending. Though the labour market is still difficult and factory output remains extremely depressed, significant improvement is likely in the next few months as growth resumes in the economies of our trading partners. We expect an expansion of Canadian real GDP in Q3.