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ATB’s Alberta Economic Outlook: Economy gradually improving, new risks emerging

ATB’s Alberta Economic Outlook: Economy gradually improving, new risks emerging

Posted on: 11/23/2018 | Author: ATB Financial's Economics + Research Team

​​ATB Financial’s newest Alberta Economic Outlook shows a stable provincial economy that is gradually making gains in the face of ongoing challenges, including the uncertainty around oil transportation and a potential global slowdown. As a result, ATB is forecasting real GDP growth for Alberta of 2.1 per cent in 2019.

Released today, the Alberta Economic Outlook provides an in-depth analysis of our economy to give helpful and timely insight to Albertans. The key findings are:

  • Employment is expanding slowly but inconsistently across sectors
  • The risk of a global economic downturn has increased slightly since August
  • The surplus of western Canadian heavy oil—and the resulting low price—presents a challenge
  • Pipeline transportation remains unresolved
  • Interprovincial in-migration to Alberta has returned to modestly positive
  • The new trade deal with the United States and Mexico (USCMA) is favourable

Even though the USCMA still has to be ratified, it is an encouraging development that provides greater clarity and certainty on trade. Retail activity, manufacturing, wholesale trade, interprovincial in-migration and other indicators also point toward gradual recovery. Rounding out the more positive economic news, agriculture and agri-food, tourism, transportation and logistics, and the tech sector are all experiencing growth.

Less positive is the continued unpredictability around pipeline construction which has created a surplus of western Canadian heavy oil. This glut has caused a low price resulting in restrained investment throughout the energy industry. Consequently, even though Alberta’s economy is improving, it’s at a more gradual pace than the average of the last 20 years, with some sectors still lagging behind. What’s more, though ATB is not forecasting one, a geopolitical financial event in 2019 is emerging as a growing risk.

Globally, growth remains intact. However, Brexit and trade disputes between the U.S. and China have spurred financial market volatility. While the global economy remains healthy, there are signs pointing toward a potential slowdown next year.

Read the complete ATB Financial Alberta Economic Outlook (November 2018). Watch ATB's Chief Economist Todd Hirsch provide a summary.

ATB Economic Outlook Nov 18, graph​​​​​

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