18 May 2011
The positive side is that Asian consumer middle-class is growing. It means the demand for Canadian exports will increase as well. According to the central bank, new middle class is growing by 70 million people per year, so by the end of this decade, it will account for 40% of the world’s population. At the moment only 10% of Canada’s exports are made for emerging markets.
The negative side is the challenge connected with the Canadian dollar. In Carney’s opinion, loonie will remain high. Moreover, it will strengthen even further. That’s why the Bank of Canada will be very careful when raising interest rates this year. It’s obvious that a rate increase will cause another Canadian dollar hike.