’Tis the season of forecasts and festive foolishness at the economics divisions of Bay Street’s big banks. All five of the top economists at Bank of Montreal penned tributes to the Canadian and global economies that they said could be sung to the tune of a particular Christmas song. (Jennifer Lee wins on originality for “Draghi Baby,” as opposed to “Santa Baby”: It’s been sluggish all year, Draghi baby/So hurry with more QE tonight.) Warren Lovely, head of public sector research and strategy at National Bank Financial, sent a “holiday poem” to his clients called “Twas the Night Before Stimulus.” Perhaps they were inspired by Avery Shenfeld at CIBC World Markets, who a few weeks wrote a commentary that he said could be sun to the tune of Adele’s hit song “Hello.”
And why not attempt to have some fun at the end of a miserable year for the Canadian economy? There was nothing uplifting in preparing an economic outlook for 2016, a year for which the most optimistic thing that can be said is that it probably won’t be any worse than the one that is about to end. Bank of Montreal sees growth of no more than 1.8% next year, compared with 1.3% in 2015. That still would be one of the slowest rates of growth outside a recession ever. Swiss bank Credit Suisse predicts gross domestic product will expand only 1.6% in 2016 and that the Bank of Canada will be forced to cut its benchmark interest rate by a quarter point in the spring.
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