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  • North American Outlook

    May 04, 2021 | 08:53

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    Separate Ways, For Now

    profile photo of Sal Guatieri

    Sal Guatieri

    Senior Economist and Director
    Economics

    Sal Guatieri is a Senior Economist and Director at BMO Capital Markets, with over two decades experience as a ma... (Read more)

    profile photo of Sal Guatieri

    Sal Guatieri

    Senior Economist and Director
    Economics

    Sal Guatieri is a Senior Economist and Director at BMO Capital Markets, with over two decades experience as a ma... (Read more)

    More
    Key Summary

    The U.S. economy is already reaping big dividends from its speedy vaccine rollout, with the economy accelerating in the first half of the year. It is on track for 6.5% growth in 2021, the fastest in nearly four decades.


    Meantime, renewed lockdowns to address a third wave of the virus likely stalled Canadian growth in the spring. Still, a peppy start to the year and an expected sharp rebound when the economy reopens should keep the nation on track for 6.0% growth this year, the most in nearly half a century.


    Despite better near-term prospects in the U.S., it is Canada's central bank that is warning of raising rates sooner than previously suggested. While both the BoC and the Fed may wait until early 2023 to raise rates, hefty fiscal stimulus and brewing inflation could advance the timing.

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