Economic Growth

With the drop in oil prices, Canada’s economic growth is also expected to take a dive, growing by only 2.0 per cent in 2015 and by about 2.3 per cent in 2016—both down from previous forecasts.

Employment

Despite the decline in the oil patch, moderate employment growth is expected to reduce the unemployment rate from 6.9 per cent in 2014 down to 6.7 per cent in 2015 and to 6.5 per cent in 2016.

Inflation

With the big swings in oil prices and the value of the dollar, accurately predicting inflation is tricky, but all agree it will be down this year and then up again next year. Forecasts range from 0.4 per cent to 1.2 per cent for 2015 and from 2.2 per cent to 2.9 percent for 2016.

Wages

Major public sector agreements settled in 2014 provided average base wage increases of just 1.5 per cent in 2014, well below the 2.3 per cent average for private sector workers and also below inflation.

Interest Rates

The Bank of Canada’s surprise cut early this year means Canadians will benefit from ultra-low interest and mortgage rates for at least another year, while borrowing rates south of the border are expected to creep up.