Economic Forecast for 2020

This year Richter hosted its annual economic forecast in conjunction with TD Bank.

We were fortunate to hear from not one but two of TD’s most preeminent leaders: Ms. Beata Caranci, Chief Economist and Mr. Brian DePratto, Director & Senior Economist at our events in Toronto and Montreal, respectively. They shared with the crowds their insights for 2020.


  • Reporting from Bloomberg’s Consensus Global Growth Chart, the global growth expectation will fall from its current 3.3% to 3.0%. As 2019 unfolded, downgrades were made to economies throughout the world given trade conflicts, headwinds, and other factors. This does seem disconnected, however, from the positive sentiment being seen in the markets.
  • While investor confidence has been riding a high and markets are expecting growth to rise, it’s not quite clear where this is expected to happen. Germany was the top performer last year but is expected to decline in 2020. The only markets expected to rise are Japan, the U.S., and Emerging Markets. Canada and Europe are expected to be steady at 1.6% and 1.0%, respectively.
  • Consumer demand in advanced economies is so far resilient and the service sector in particular is very strong even with industrial production on the decline.


  • TD’s Leading Economic Index, pulling from major economic indicators, is reporting a bit of a slowdown. Manufacturing is seeing a slow down but the biggest challenge for the U.S. overall is uncertainty. Because of this, investment is seeing a decline.
  • With trade, it’s “TBD” for how the China-U.S. trade deal will play out. As it stands, the ask for purchasing in areas such as manufactured goods and energy is huge, which leads to the question of capacity to deliver. Broadly, this isn’t being seen as a game changer on the whole.
  • S. mortgage rates have also been up and down. Interest rates were down in 2019 so there was a slight uptick in single family homes sales. This is encouraging for those in the building and supplies industries and may trickle into other discretionary spending as well – furnishings, recreational vehicles, etc.
  • Wage growth is growing – particularly in high-paying jobs, as well. Overall, it seems that the scars of the 2008 crisis are fading.


  • GDP growth in Canada in 2019 was pretty uneven, seeing a large spike in the second quarter and a softer fourth quarter, given the rail strike and other disruptions, which means less momentum coming in to 2020. But towards the third and fourth quarters of 2020 it is anticipated to be back to the typical 2.0%.
  • Looking regionally, a big surprise is seeing PEI forecasted to lead provincial growth by a large margin, even over second-place Quebec. PEI tops this list largely due to population growth. Quebec is in second given it has had a strong labour market for the past few years and now borrows at a lower cost than Ontario. BC and Ontario are in line with the national average, while the Atlantic and prairie provinces lag below.
  • TD is expecting the Bank of Canada to cut its rate given the current downside risks to the economy. While it’s not the start of several rate cuts or is any reason to panic, TD sees this largely as more of a “reset” of expectations: managing longer-term borrowing costs that have been impacted by everything going on globally – not to mention new obstacles that could have an impact, such as the coronavirus.
  • While population growth has helped propel the economy, it can’t be relied on to prop it up continually. And while employment reached new heights in 2019, there was a slowdown in the second half of the year.
  • On the positives: housing. Population growth and strong labour markets have helped spur this.
  • 2020 consumer spending trajectories will see a baseline of 1.6% (same as last year) with signs of lingering trade uncertainty, high debt service ratios and a low savings rate of 1.7%. The upside of consumer spending is at 2%, with strong employment growth, wages at a roughly 4% year-over-year growth, the housing market recovering and yields staying at current levels.


We would like to thank Ms. Caranci and Mr. DePratto for their time and valuable insights during our Economic Forecast Events.

Thank you to partners Mitch Silverstein and Johnny Di Maria for organizing these events.


*Facts and figures as mentioned above are cited from the presentation from Mr. DePratto.