Canada’s rolling slowdown defies the recession label, TD says
“Economic weakness has met the minimal duration test, but not the depth or breadth of a conventional recession,” Billy-Ochieng’ wrote.
Mortgage brokers tracking client demand have watched economic conditions shift unevenly across sectors, a pattern that lines up closely with TD’s characterisation of a rolling, rather than synchronised, downturn.
Brokers and economists weighing in on Canada’s GDP miss and what it means for the Bank of Canada rate path have noted that headline data continues to obscure the more granular picture facing households and businesses.
Population growth distorted the picture
At the centre of TD’s argument is the outsized role population growth has played in shaping GDP readings.
During the early post-pandemic years, rapid population expansion lifted aggregate output, helping Canada avoid an outright GDP decline even as GDP per capita fell year-on-year through 2023 and 2024.
