Analysis Of Canadian Economy

The Canadian economy today is at an all-time high with higher economic growth and rising GDP Canada is seeing great changes in the economy. The GDP increase by 1.1 percent in just the first 3 months of 2017. Canada is quickly recovering from the decline in oil prices that significantly slowed down the growth of the Canadian GDP. Because oil plays such a major role in the Canadian economy this had a huge tole on the overall GDP of this country. But, as the country approaches an increased GDP the energy sector does not seem to be hindering the GDP any longer. With the price of oil and gas going back up this has significantly increased the GDP of Canada due to the large amount of petroleum that Canada produces.

c) In a recession, the Bank of Canada will conduct an open market purchase to lower the interest rate. The quantity of investment will increase, and other interest-sensitive expenditure items will also increase. With an increase in aggregate expenditure, the multiplier increases aggregate demand, bringing real GDP to equal potential GDP, and a recession will be eliminated.

The weak economic growth in Asia ad in Europe has helped in benefiting Canada and the US. Asia and Europe had also faced deflationary pressures which were caused by the changes in the rates of interest rates in the economy. The risk of the inflationary pressure in the US led to the increasing concern of the federal reserves. The Canadian bonds have been trading at a considerably lower yield as compared to the US bonds in the market. The situation was supposed to be maintained if the Canadian dollars in the economy appreciated relatively to those of the US dollars in the economy. The outlook for the bonds in the economy looked to be very attractive an aspect which was attributed to the changes in

Department of Finance Canada (2009) states Canada has been significantly affected by the global recession and Canadian economy growth began to slow in the fourth quarter of 2008. Real GDP declined by 3.7 percent in the fourth quarter of 2008. Although Canadian economy is being affected by the global recession, the Canadian economy is still better than other industrialized countries (CMA Business Case)

Canada’s economy has to face many issues. One of these being the rate of exchange. The canadian dollar has been going up and down constantly throughout many years. “The first paper money issued in Canada nominated in dollars were British Army notes, issued through 1813, The Bank of Canada was created in 1934 and given responsibility, through an Act of Parliament.” Much has happened to the dollar throughout the years; the economy always varied depending on the dollar worth because it has always played a major role on the economy. Pertaining to the issues of the exchange rate, I will discuss two main ways of it and how it plays a big role on the economy in present times.

For the period of high inflation, government’s goal is to lessen the spending in the economy by making it less attractive to acquire loans or by taking currency out of circulation which eventually reduces inflation (Investopedia, 2008). “A major reduction in the rate of money-supply expansion ultimately will reduce even strongly entrenched inflation. But this accomplishment may take several years during which output and employment both fall (Wirick, 2001)”. The new contractionary monetary policy in New Brunswick will directly raise the interest rate by making money harder and more expensive to obtain. As a result, investment in New Brunswick will fall because the cost of borrowing money increases. Net exports tend to rise due to an increase in the interest rates because New Brunswick’s investment will relatively be more attractive to both domestic and foreign investors.

The government has an enormous influence on the economy of its nation. As of November 2015, Canada will be under the leadership of Justin Trudeau and his Liberal party. The article predicts how the newly elected government will influence the Canadian economy. The government affects the economy through the manipulating the value of its currency, government bonds, and annual spending. Factors such as interest rates and government debt would affect a nation’s currency and consequently, the economy. Government bonds help determine interest rates. Annual spending on government projects, such as infrastructure, would increase the GDP (Gross Domestic Product) of a country. GDP increases will boost the economy.

The strength of the U.S. economy is important for Canada’s trade, economy and exchange rate. Increasing U.S. unemployment can positively or negatively influence the value of the loonie. Canada’s dollar can increase due to demand from buyers looking to invest in a stable economy with low risk. On the other hand, Canada’s GDP is dependent on U.S. trade. If less Americans are purchasing goods in Canada due to increased unemployment, the Canadian dollar will fall. Therefore, it is inconclusive that unemployment rates solely influence the rise of the Canadian dollar. There are many other factors that influence the exchange rate, such as commodity prices, investor confidence, overvalued currency and inflation rates.

Letter no.15: "Trade in Quebec City; general trade of the country and of his majesty's domain"

The value of the Canadian dollar tends to moves in tandem with oil prices so as oil prices have been falling recently, so has the value of the Canadian dollar. A depreciation of the Canadian dollar makes Canadian exports relatively more competitive in the world market however, as Canadian exports become cheaper relative to its imports, this negatively affects the Canadian terms of trade. This

The Canadian economic system is often described as a mixed economic system, where the public and private sector influence the market. Decisions on what, how, and for whom to produce are made by the private sector under the influence of the public sector. The Canadian economic system is often likened to the American one despite the fact that, unlike the American (capitalist) economy, there is a significant amount government influence on the market in Canada. Canada’s mixed economy is the integration of Adam Smith’s and Karl Marx’s economic perspectives and theories, with Marx’s theories having a greater influence on it. Adam Smith was a firm believer of the market economy (often capitalist), where the market prices are controlled solely by

Canada is home to world leading manufacturers of foods, beverages and consumer products. These firms make significant contributions to the Canadian economy and Canadian’s quality of life. The manufacturing industry has been helping the Canadian economy grow and become stronger but for 2015, this has not been the case. This report will be focusing on the manufacturing industry and how it coincides with Canada’s economy. The three subtopics focused on in this report are the effects of the manufacturing industry on gross domestic product (GDP), inflation and unemployment. Through analysis of the three subtopics, the reader will get a better understanding of how the manufacturing industry is “reacting” to these factors. There will also be

Due to America’s increasing government debt and declining interest rates, Canada’s economy is comparatively more stable. Canada’s credit rating is currently higher than America’s. A credit rating indicates the financial health of a country and how large the risk is for lenders to invest. Standard and Poor’s, a credit rating agency, currently downgraded America’s rating to AA+ from the highest score of AAA. The downgrade was a result of the U.S.’s increasing debt from the recession. Canada’s credit rating is still the highest at triple-A because of the country’s stability. Canada is more attractive to invest in, as there are solid returns on the interest rates and low risk for lenders. Increased demand in Canadian assets can result in a higher exchange rate. Investors want to put money into a country where they believe it is a safe haven.

Recession is a term that looms over any society at some point or another but what does recession mean for the economy, in short it is an economic decline. This essay will examine the meaning of recession and will discuss the fiscal and monetary policies that are used to pull economies out of recessions. The great Recession of 2008 will shed light on how these policies were successful at restoring economic growth and reducing unemployment.

interest rates, while U.S. investors reduce their investments in Canada’s securities.  This places downward pressure on the Canadian dollar’s value.