Quebec technically entered a recession on Thursday, Quebec Statistics Institute figures showed, due to a decline in gross domestic product for the second straight quarter, but Legault's government continues to talk about an economic slowdown. Finance Minister Eric Girard estimated that it was still too early to talk about a recession.
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However, for the Vice President and Chief Economist at Desjardins Group, this data should not be taken lightly. “The probability that we are in a recession is very high. We rarely have false signals, and we still have to take this seriously. Can we announce that we are in a recession as we speak? I would say that “It's not clear yet.”
To see a recession, you have to see widespread weakness in the economy. Currently, the numbers show an increase in spending by Quebecers, and a slight recovery in housing construction.
“It's not actually a general weakness. On the other hand, it's also true that the economy is in a neutral position. Over the past year, unemployment in Quebec has been on an upward trend. We are seeing families increasing their savings as a precautionary measure.”
It is considered that the fourth quarter, which will be witnessed by the strike, will have more serious consequences.
He believes that “the hypothesis that seems most plausible to me is that we are already seeing a recession materializing in reality.”
Rising costs of living, mortgage payments, and inflation are hitting families hard, especially those with low incomes.
“That's why people feel we're in a recession. There are still difficulties in the coming months and quarters. From mid-2024, we should see a recovery and the Bank of Canada should start cutting interest rates.”
Therefore the economy should bounce back.
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