Canada’s former central banker, David Dodge, has a message for investors: low growth is the new normal.
“We are not in a recession. This is a lower growth world,” Mr. Dodge said at a panel discussion in Toronto Thursday evening.
Canada’s economy is forecast to expand just 1.7 per cent this year and grew a meagre 1.2 per cent in 2015 after dipping into a mild recession in the first half of the year.
The new Liberal federal government as well as Canada’s central bank have taken actions to help bolster the nation’s economy.
Ottawa has promised to double spending on infrastructure over the next decade. And the Bank of Canada cut interest rates twice last year, and floated the idea of slashing rates below zero.
“It’s not a hopeless world,” said Mr. Dodge, who is now in private practice at law firm Bennett Jones. “It’s just that we got used to a world that was spectacular. But that’s not normal.”