IMF Cuts Canadian Economic Predictions

IMF growth predictions | BCBusiness
The IMF downgraded Canada’s economic growth for 2012 due to a mild recession in Europe.

As Europe’s debt problems compound, the IMF announces Canada won’t get off as easily in 2012 as we may have hoped.

Former president Bill Clinton was the first to coin the phrase, “It’s the economy, stupid.” Well, actually, it’s all about Europe’s economy, stupid.
 
Tuesday morning, the International Monetary Fund slashed Canada’s expected growth for 2012 from two per cent down to 1.7 per cent. As eurozone economies spontaneously combust, they’re dragging Canada and many other nations down with them.
 
It’s just one of the many great “benefits” of a global economy.
 
Canada will fare better than other industrial nations, although that isn’t saying much. The IMF warns that Europe will experience a mild recession. Germany, Italy and Spain will see negative growth.
 
Expected global growth was downgraded as well, as the global financial monitor predicts expansion of only 3.3 per cent this year, compared to its September 2011 prediction of four per cent. And IMF head Christine Lagarde ominously cautioned if Europe didn’t take decisive action, growth forecasts would see further cuts.
 
The eyes of the world will follow global leaders even more closely later this week at the World Economic Forum in Davos, Switzerland. Perhaps the mounting pressure and new IMF predictions will light a fire to finalize a permanent debt solution for Europe.