While our southern neighbors seems to find new ways to increase the Federal deficit, Canada's new majority conservative government plows ahead with plan to turn its current deficit into a surplus by 2014/15.
As I have often mentioned Canadian are well versed in the risk of ever rising deficit, and most Canadian remember how painful the correct was to Canada's economy (1996/00). We also know that we correct our budget deficit while the world economy was growing at a fast clip (no longer the case).
Jim Flaherty "re-introduced" his March budget (the one that caused the 2011 Federal elections) almost unchanged. Canada's economic position remains more or less unchanged -- although the Canadian dollar, unlike other resource based currencies has remained subdue in the face of rising commodity prices because of the fear that America's economy is heading back into a recession.
As usual the normal caveat must be assumed, should the U.S. really fall into a new recession (instead of a slow down) then all bets are off, since Canada is extremely dependent on the U.S. for its export market -- down from a peak of 85%, to around 75% -- a solid percentage of that are natural resources... still. On another note the market is 100% discounting (today at least) of any rise in interest rate by the Bank of Canada for the rest of 2011 (Q1/12 is starting to look iffy too).
As I have often mentioned Canadian are well versed in the risk of ever rising deficit, and most Canadian remember how painful the correct was to Canada's economy (1996/00). We also know that we correct our budget deficit while the world economy was growing at a fast clip (no longer the case).
Jim Flaherty "re-introduced" his March budget (the one that caused the 2011 Federal elections) almost unchanged. Canada's economic position remains more or less unchanged -- although the Canadian dollar, unlike other resource based currencies has remained subdue in the face of rising commodity prices because of the fear that America's economy is heading back into a recession.
As usual the normal caveat must be assumed, should the U.S. really fall into a new recession (instead of a slow down) then all bets are off, since Canada is extremely dependent on the U.S. for its export market -- down from a peak of 85%, to around 75% -- a solid percentage of that are natural resources... still. On another note the market is 100% discounting (today at least) of any rise in interest rate by the Bank of Canada for the rest of 2011 (Q1/12 is starting to look iffy too).