IMF Staff Country Reports

Canada: 2024 Article IV Consultation-Press Release; and Staff Report

July 16, 2024

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Format: Chicago

International Monetary Fund. Western Hemisphere Dept. "Canada: 2024 Article IV Consultation-Press Release; and Staff Report", IMF Staff Country Reports 2024, 228 (2024), accessed November 21, 2024, https://doi.org/10.5089/9798400279966.002

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Summary

The 2024 Article IV Consultation discusses that the Canadian economy appears to have achieved a soft landing: inflation has come down almost to target, while a recession has been avoided, with gross domestic product growth cushioned by surging immigration even as per capita income has shrunk. Housing unaffordability has risen to levels not seen in a generation, with demand boosted by immigration and supply facing continued challenges to expansion. Canada’s recent introduction of quantitative fiscal objectives is welcome and could be followed by adoption of a formal fiscal framework to anchor fiscal policy even more effectively. The authorities’ multipronged approach to address housing affordability is expected to yield results over time, but further efforts will likely be needed at all levels of government to address the large housing supply gap. Boosting Canada’s lagging productivity growth—including by taking steps to promote investment and R&D, harness artificial intelligence and other advanced technologies (within appropriate guardrails), and capitalize on the green transition—is a key priority for the country’s long-term prospects. Given skills gaps and demographic pressures, immigration remains a critical ingredient.

Subject: Financial sector policy and analysis, Financial sector stability, Housing, Inflation, Labor, Labor markets, Migration, National accounts, Population and demographics, Prices

Keywords: Consultation cycle, Consultation notice, Emissions-reduction goal, Financial sector stability, Further policy guidance, Global, Housing, Inflation, Investment Canada Act, Labor markets, Migration

Publication Details

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