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Economists predict slight rebound and moderate growth for B.C. economy in 2021 – North Shore News

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VICTORIA — Finance Minister Selina Robinson said she’s encouraged by predictions that British Columbia’s economy will rebound this year and next. 

Robinson heard Friday from economists on the province’s Economic Forecast Council who estimate B.C. is on track for real GDP growth of 4.7 per cent this year and 4.3 per cent next year, before growth slows. 

The same measurement for the provincial economy in 2020 shows a 5.1 per cent decline, the worst contraction since 1980.

“We can see the light at the end, but we’re still in the tunnel,” Robinson said in an interview after the hearing from the council. 

The council of economists from major financial institutions and business associations warned that the strength of recovery depends heavily on the rollout of COVID-19 vaccines. 

Recovery is expected to escalate as the province reaches herd immunity and consumer activity increases, while work ramps up in areas like construction on resource projects.

All signs point to a strong recovery in the United States, which will also help boost B.C.’s rebound, several economists said during the session. 

But Robinson also heard the recovery won’t be felt evenly, with certain hard-hit industries and low-wage earners tending to suffer the greatest ongoing impacts of the pandemic. 

Women, people of colour and those without more than a high school education have fared worse than others, Robinson heard. 

At the same time, the skilled labour market is expected to tighten, suggesting good government policy could involve investment in training, education and financial support for those transitioning to new industries, she heard. 

“Obviously, here we are 10 months out and there are some doing really well and others being completely left behind,” Robinson said. 

“What caught my attention was making sure that we’re investing right now in people, but also into the future.”

Online shopping will likely change retail in the long term, while struggling sectors like tourism may see a strong, if delayed, rebound thanks to pent-up demand for travel and leisure, Robinson heard. 

The challenge will be to bridge the current situation to the time when there is herd immunity, while maintaining an active tourism sector, she said. 

The minister said the next B.C. budget will focus on continuing to support British Columbians through the emergency of the pandemic while investing in the future. 

The government will table its budget on April 20 after legislation passed in December allowed it to delay its introduction from the traditional date in February.

The B.C. government announced late last year that the deficit forecast had grown and the budget shortfall was expected to hit $13.6 billion this fiscal year. 

The Finance Ministry predicted B.C.’s economy would decline by 6.2 per cent in 2020, but growth was expected to rebound to three per cent in 2021. 

Liberal finance critic Mike Bernier said the economic forecast report makes clear there is much more work in store for the New Democrat government on the road to economic recovery. It begins with fixing “growing problems” in their current support programs, he said in a statement. 

“The forecast council is doing important work looking ahead to the economic future of British Columbia, and that is certainly vital, but we cannot let the government forget about the here and now,” Bernier said. 

He accused the government of fumbling the provision of economic support at nearly every turn, from delayed pandemic pay to a “botched” rollout for small and medium-sized businesses. 

Of the $300 million set aside for B.C. businesses at the beginning of the pandemic, only $21 million has been distributed, Bernier said. 

“We need to see (Premier) John Horgan and his government take immediate steps to fix their ineffective programs and provide people with the relief they need to make it through this pandemic.”

This report by The Canadian Press was first published Feb. 26, 2021.

Amy Smart, The Canadian Press

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Major economies should inject 'significant' support for global economy: Yellen – TheChronicleHerald.ca

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By Andrea Shalal and David Lawder

WASHINGTON (Reuters) – U.S. Treasury Secretary Janet Yellen on Thursday warned of the risk of a permanence divergence in the global economy in the wake of the COVID-19 crisis, and urged major economies to inject significant new fiscal support to secure a robust recovery.

In a statement to the steering committees of the International Monetary Fund and the World Bank, Yellen underscored the need for major economies to continue supporting developing countries as they grapple with the COVID-19 pandemic, climate change and high debt burdens.

She urged the World Bank to help countries, particularly the world’s poorest, get timely access to COVID-19 vaccines, and backed accelerated negotiation to replenish the World Bank’s International Development Association fund for the poorest countries – a goal the bank aims to reach by December.

The United States had pledged $4 billion to the COVAX global vaccine distribution initiative, Yellen said, urging others to join in.

She signalled that Washington, which so far has only loaned vaccines to Mexico and Canada, could provide excess doses to other countries in the future.

“The United States will continue to work with partners to increase vaccine supplies, explore sharing excess vaccines, and make sure financing does not become an obstacle for global vaccination,” Yellen said, without providing any details.

Yellen’s comments reflect the Biden administration’s focus on strong international cooperation to tackle global challenges – a sharp departure from the “go-it-alone” approach pursued by former President Donald Trump’s administration.

“The (COVID-19) crisis has exacerbated the trend of rising income inequality, raising concerns about a divergent path within and across countries. We also face the existential threat of climate change. We can only resolve these problems through strong international cooperation,” Yellen said in remarks prepared for her first meeting with the IMF’s International Monetary and Financial Committee and the World Bank’s Development Committee.

The former head of the Federal Reserve said substantial fiscal and monetary support from major economies had improved the global economic outlook significantly, but more efforts were needed.

Washington was implementing a $1.9 trillion COVID-19 relief plan and was working on another large infrastructure package, Yellen said, urging other major economies to take similar actions.

“The job is not yet done, given high uncertainty and the risk of permanent scarring,” she said. “I urge major economies to not just avoid removing support too early, but to strive to provide significant amounts of new fiscal support to secure a robust recovery.”

Yellen said developing countries should work with the IMF and World Bank on economic policies and structural reforms and seek full-fledged IMF financing programs, which carry conditions, where necessary. Some countries may need deeper debt treatment, she added.

She called on all creditors to “fully and transparently” implement the Group of 20’s common framework for debt treatments to avoid “unnecessary delays that can prolong debt overhangs and exacerbate growth shocks.”

She also urged the World Bank to lead on “transformative climate investments” and to continue to set an aggressive agenda on climate and the green recovery from the crisis.

(Reporting by Andrea Shalal and David Lawder; Editing by Toby Chopra and Paul Simao)

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Canadian dollar pulls back from two-week high ahead of trade data

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Canadian dollar

TORONTO (Reuters) -The Canadian dollar weakened against its U.S. counterpart on Tuesday as concern rose about Canada‘s third wave of the COVID-19 pandemic and investors awaited domestic economic data that could offer clues on the Bank of Canada‘s policy outlook.

The loonie was trading 0.4% lower at 1.2573 to the greenback, or 79.54 U.S. cents, having pulled back from its strongest level since March 22 on Monday at 1.2497.

Canada‘s trade report for February is due on Wednesday, while the March employment report is due on Friday.

“Our expectation is for a little bit stronger CAD on the back of some positive data,” said Kyle Dahms, economist at National Bank of Canada.

He expects Canada‘s current account balance to turn positive over the coming months, helped by higher commodity prices, and that the Bank of Canada will cut its bond purchases when it makes its next interest rate announcement on April 21.

Such a move would put the Canadian central bank at odds with some peers, including the Federal Reserve and the European Central Bank, which have said they will maintain or even increase the pace of bond-buying.

The IMF raised its 2021 growth forecast for Canada by 1.4 percentage points to 5%, the biggest upgrade among G7 economies, while strong economic data from China and the United States helped to lift the price of oil, one of Canada‘s major exports. U.S. crude prices settled 1.2% higher at $59.33 a barrel.

Still, Canada‘s hospitalizations are surging as a third wave of the pandemic sweeps across much of the country, Prime Minister Justin Trudeau said.

Canadian government bond yields were lower across a flatter curve in tandem with U.S. Treasuries. The 10-year touched its lowest level since March 29 at 1.485% before edging up to 1.490%, down 6.5 basis points on the day.

(Reporting by Fergal SmithEditing by Paul Simao and Jonathan Oatis)

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TSX rises 0.41% to 19,104.14

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* The Toronto Stock Exchange’s TSX rises 0.41 percent to 19,104.14

* Leading the index were OceanaGold Corp <OGC.TO​>, up 6.8%, Silvercorp Metals Inc​, up 6.6%, and Real Matters Inc​, higher by 6.5%.

* Lagging shares were OrganiGram Holdings Inc​​, down 5.0%, Aphria Inc​, down 4.8%, and Denison Mines Corp​, lower by 4.3%.

* On the TSX 163 issues rose and 65 fell as a 2.5-to-1 ratio favored advancers. There were 23 new highs and no new lows, with total volume of 205.4 million shares.

* The most heavily traded shares by volume were Toronto-dominion Bank, Tc Energy Corp and Bank Of Nova Scotia.

* The TSX’s energy group rose 1.14 points, or 1.0%, while the financials sector slipped 0.09 points, or 0.0%.

* West Texas Intermediate crude futures rose 0.94%, or $0.55, to $59.2 a barrel. Brent crude  rose 0.87%, or $0.54, to $62.69 [O/R]

* The TSX is up 9.6% for the year.

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