Link to Article: Canada’s economy likely gains momentum as Omicron wanes | Reuters
The Canadian economy is starting to have gains now that COVID restrictions are being lifted. Canada had for the first time since the beginning of the pandemic a quarter where their GDP was higher than it was at the beginning of the pandemic. This is occurring at the same time as Canada is suffering from around 5.5% inflation rate. Canadian analysts have predicted that Canada will have a 4% growth of GDP during 2022. It is unclear how this goal will be affected by the ongoing conflict that is occuring in Ukraine.
The ongoing war in Ukraine is likely to hinder the possible growth of the Canadian economy. Another major hindrance is the ongoing high inflation rates with the other members of the USMCA with the United States having an inflation rate of 7.87% and Mexico having an inflation rate of 7.28%. With these other countries having higher inflation rates it will make it so that the American and Mexican consumers are less likely to purchase as high a quantity of Canadian goods. However, if Canada can increase their domestic sales they would still be able to meet their goal of 4% increase in GDP without as much export of goods.
If Canada is able to have a higher GDP than that of before the pandemic it would hopefully lead the way in other large economies recovering from COVID. Canada is the 9th largest economy so the actions that happen there are likely to show the way of actions that will be taken by other large economies. If Canada is able to be more prosperous it is also likely that it will help to boost both the United States and the Mexican economy as all three are members of the USMCA and economic boons for one are likely to help the economies of all parties involved.