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BMO Financial Group

June 01, 2011 10:41 ET

BMO Blue Book: Nova Scotia Growth Softening, but Major Projects Generating Optimism

HALIFAX, NOVA SCOTIA--(Marketwire - June 1, 2011) - Nova Scotia's economic growth will see a downshift this year, but provincial revenues will benefit from current and new major energy and infrastructure projects, according to the first edition of the BMO Blue Book, a joint publication of BMO Capital Markets Economics and BMO Commercial Banking. Much like the U.S. Federal Reserve's Beige Book, the BMO Blue Book combines the expertise of BMO's economists with information on current business conditions provided to BMO's commercial bankers by local businesspeople.

"Growth in 2011 will soften to 1.9 per cent in 2011 after a below-average 2.1 per cent in 2010," said Robert Kavcic, Economist, BMO Capital Markets. "Fiscal restraint and a slowdown in capital spending by the province are set to weigh on growth in the near term."

Steve Murphy, Senior Vice-President, Atlantic Provinces Division, BMO Bank of Montreal, noted that a significant number of major projects are still either underway or planned. "These projects are good for provincial revenue, and therefore good for the local economy. The Deep Panuke project by Encana, for instance, has brought in a significant amount of capital to Nova Scotia. In the future, we see more potential projects such as the military fleet renewal plan and the infrastructure for bringing energy from the Lower Churchill project in Newfoundland & Labrador to Nova Scotia."

The full report can be found at www.bmocm.com/economics.

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