Economic Outlook Summary

MARCH 2020


As the unexpected COVID-19 outbreak slowdowns the world economy and decimates the stock markets, many businesses are left wondering what will happen next and, how to plan for the future.

With that in mind, CME’s economics team reviewed Canada’s economic performance up to March 2020 to understand what it means for manufacturers. This report provides an overview of what happened so far and, projections for what might happen next in the short and, long-term.

Based on historic patterns, emerging trends and an understanding of a deep and complex series of cause-and-effect relationships, CME’s projections also counter in the “known unknowns” – factors that we know will impact the economy, whether for good or for ill, but whose effect is far from clear. At this stage, decisions by governments, businesses and people can all have a critical impact on how Canada and the world will fair in pulling itself out of the recession caused by the coronavirus.


  • The coronavirus has pushed the world into a recession, with global GDP growth forecast to reach just 0.4 per cent this year.
  • A collapse in growth in the second quarter will be followed by a rebound in economic activity over the second half of the year and into 2021. This will allow global real GDP growth to turn positive and reach 3.9 per cent next year.
  • The United States economy is projected to contract by 3.1 per cent in 2020, before rebounding with a 3.4 per cent gain in 2021.
  • Canadian real GDP is forecast to fall by an even steeper 3.8 per cent this year, with the economy recovering and expanding by 3.2 per cent in 2021.
  • As an essential service, the Canadian manufacturing sector will continue operating through the government-imposed shutdowns. Even still, it is set to post its biggest decline in output since the global financial crisis this year, due to weak demand for certain products.
  • Manufacturing output growth will bounce back in 2021, in line with improving domestic and global economic conditions.