OECD: Canada to Lead G7 Countries in Economic Growth During First Half 2011

OTTAWA — Chilly inflation and lukewarm growth aside, Canada’s economy is still a relatively stellar performer compared to other development countries. That’s something Prime Minister Stephen Harper and Finance Minister Jim Flaherty are fond of reminding us. We already know price increases are going sideways, for now, and interest rates are frozen, for even longer. This week, though, Canada’s bragging rights could be put to the test.

OTTAWA — Despite indications to the contrary, Canada’s economy may actually be chugging along at a steady — if not stellar — pace. Signs of growth are continuing to appear, according to a leading Canada indicator, and much of that strength is the product of an improving U.S. environment. The Macdonald-Laurier composite leading index advanced 0.2% in January, following a 0.3% gain in December but still matching increases in the previous three months.

The risk of a new major (global) contraction cannot be ruled out OTTAWA — With global conditions weakening, Canada’s economy will remain in the slow growth lane until the middle of next year, the Organization for Economic Co-operation and Development predicts in a new forecast. The OECD projects Canada’s economy will grow by 1.5% in the final three months of this year, and advance only 1.8% in 2013.

The OECD says Canada’s economy is in a funk and may no longer be a leader among the other G7 industrialized nations in terms of growth. The Paris-based organization’s latest analysis of the global economy cites firming growth in the United States and Japan, as well as improving prospects for Germany. It says Canada’s conditions point to continued growth but at a weak pace. The federal government has long boasted that Canada’s growth was top among the Group of Seven industrialized economies following the 2008-09 recession.

OTTAWA — We already know Canada’s economy ended last year in dismal shape. While no one is predicting a healthy turnaround this year, you may soon see some stronger vital signs. In a week of clustered economic data — from interest rates to employment numbers — a major Canadian bank says, “based on admittedly slim evidence,” the first quarter of 2013 could bring surprising — though not great — growth.

Canadian heavy oil prices reached a six-month high on the spot market amid a seasonal decline in production from Alberta. Canadian oil rig counts dropped by 30 to 117 this week, down from this year’s high of 509 during the week ended March 1, Houston oil field-services company Baker Hughes Inc. said Friday.

MarketPulse FX submits: By Scott Boyd Early indications are that the Canadian dollar could decline ahead of today’s Bank of Canada interest rate announcement. Despite recording a 3.9 percent increase in Gross Domestic Product for the first three months of the year, most observers expect Governor Mark Carney to announce that the Bank of Canada will not raise rates beyond the current 1 percent. This could have investors selling the dollar for currencies offering higher yields.

High oil prices could stall economic recovery in some top economies, the International Energy Agency warned on Tuesday when it upgraded its forecast for global oil demand this year.Higher prices together with tighter credit conditions "could stall OECD economic recovery," the IEA said referring to the 30 advanced economies covered by the Organisation for Economic Cooperation and Development.The OECD, based in Paris, includes Britain, France, Germany, Japan and the United States, and the IEA is its oil monitoring branch.