One in three chance of having a recession, according to Minister Eric Girard

Quebec has a one in three chance of experiencing a recession in the coming months, Finance Minister Eric Girard reiterated on Wednesday.

One in three chance of having a recession, according to Minister Eric Girard

Quebec has a one in three chance of experiencing a recession in the coming months, Finance Minister Eric Girard reiterated on Wednesday.

"The most likely scenario is a slowdown in the economy and not a recession," sought to reassure Mr. Girard, who assesses the chances of a slowdown at 67%, against 33% for those of a recession.

The minister had advanced the same prognosis in mid-June, while he assessed the chances of a recession at 25% earlier in the spring. Its leader, Prime Minister François Legault, however, mentioned for his part, still in mid-June, that Quebec had a one in two chance of finding itself in recession.

The latter also expects the inflation rate, which reached 7.7% in May – a peak since January 1983 – to peak in June, before starting to come down.

Recall that economists generally consider that a State is in recession when its gross domestic product decreases for two consecutive quarters.

Mr. Girard is due to present an update on the state of the government's finances on August 15. In the meantime, everything suggests that the Bank of Canada will once again raise its key rate by 0.5 or 0.75.

“What we observe is that central banks are in a hurry to move from a situation where the level of interest rates stimulates the economy. We want to go to a neutral level, between 2.5 and 3%, and we are going there by the end of the year, ”said Mr. Girard.

“It is very likely that this will be enough and that the economy can land gently,” added the Minister of Finance, who promises, however, that the Coalition avenir Québec will propose measures during the election campaign to help households affected by rising prices. costs of a multitude of products.

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