Philip CrossWeak growth for the fifth straight month raises doubts on rosy reports of an economic boom

OTTAWA, Nov. 1, 2017 – Canada's economic growth slowed once again in September.

The Macdonald-Laurier Institute’s Leading Economic Indicator, a tool designed to predict changes in the Canadian business cycle, rose by 0.1 percent in September. This was its fifth consecutive increase of 0.2 percent or less.

“This slowdown has been driven by the housing component, which fell for the fifth straight month in response to government actions to cool the Toronto housing market,” says Munk Senior Fellow Philip Cross, the author of the LEI.

The persistence of slow growth in the leading indicator demonstrates that the buoyancy of the Canadian economy in the first half of 2017 mostly reflected non-recurring events rather than the beginning of self-sustaining higher growth that stimulative fiscal and monetary policies had hoped to achieve.

To learn more about the leading economic indicator, click here.

The leading index is designed to signal an upcoming turn in the business cycle, either from growth to recession or from recession to recovery, six months in advance, with an error rate of less than five percent. It does so by monitoring what businesses and households have actually committed to in terms of future spending and production in the most cyclically-sensitive sectors of the economy. It also incorporates global influences such as the direction of the US economy and the broad thrust of monetary policy.

The index is available on Bloomberg and is intended for journalists and analysts who follow the macro performance of the Canadian economy. Quarterly economic analyses by Cross, based on the results of the indicator, will appear on the MLI website.


Philip Cross is a Munk Senior Fellow with the Macdonald-Laurier Institute. He previously served as the Chief Economic Analyst for Statistics Canada, part of a 36-year career with the agency.

The Macdonald-Laurier Institute is the only non-partisan, independent national public policy think tank in Ottawa focusing on the full range of issues that fall under the jurisdiction of the federal government.

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