Not a recession yet, says Canada's recession authority
The C.D. Howe Institute says two quarters of shrinking GDP aren't enough to call it official—economists warn against reading too much into the data.
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Canada's unofficial recession referee is pumping the brakes on declarations of economic crisis, even as politicians trade blame over the country's sluggish growth.
The C.D. Howe Institute's Business Cycle Council, traditionally viewed as Canada's arbiter for recession calls, issued a bulletin Friday saying two consecutive quarters of declining GDP don't meet the threshold for a formal recession label. The council urged caution against over-interpreting recent Statistics Canada data showing the economy contracted in back-to-back quarters.
A group of economists within the council argues that weakness in Canada's economy hasn't yet become widespread or persistent enough to warrant the recession designation. The marginal first-quarter decline will likely be subject to revisions in coming months, they said.
The debate has raged on Parliament Hill since Statistics Canada's report last week. Conservatives have blamed a "full-blown recession" on the Liberal government, while Prime Minister Mark Carney argues growth will be uneven as the country pivots away from reliance on the United States.