CHARLOTTETOWN, PRINCE EDWARD ISLAND--(Marketwired - May 7, 2014) - Firmer U.S. economic growth and a weaker Canadian dollar are projected to support growth across the province this year, according to the BMO Blue Book released today by 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.
"Prince Edward Island continues to modernize its economy while maintaining tourism, agriculture and the fishery as economic pillars," said Carolyn Booth, Senior Vice President, Atlantic Provinces Division, BMO Bank of Montreal. "PEI businesses are establishing world class expertise in aerospace, pharmaceutical, chemical, and bioscience industries. These industries combined have experienced 300 per cent growth since 2007 and are expected to reflect additional growth in the years ahead."
"Real GDP is expected to cool slightly to 1.3 per cent this year, down from a 1.4 per cent pace in 2013," said Robert Kavcic, Senior Economist, BMO Capital Markets. "With U.S. demand expected to strengthen this year and the Canadian dollar settling into lower levels, the trade and tourism sectors stand to support growth for the province in 2014."
Mr. Kavcic noted that exports were strong last year, and remained well above year-ago levels in the first two months of 2014, led by still-lofty aerospace shipments and higher exports of farm, fish and food products.
According to Allison Hakomaki, Regional Vice President, Commercial Banking, Atlantic Provinces Division, BMO Bank of Montreal, customers in the fishing industry expect improved global economic conditions to provide a boost to the bottom line. "The drop of the Canadian dollar is expected to increase foreign demand and make exports even more attractive for our customers. Furthermore, increased efforts to market these products more aggressively in traditional markets like the United States and Europe and to emerging Asian markets should foster global demand."
Ms. Hakomaki added that BMO is armed with a highly-skilled team of experts that can make lending decisions at the local level to help boost productivity, expand into new markets and make strategic investment decisions that will help propel growth and drive success for local businesses.
The full BMO Blue Book can be downloaded at www.bmocm.com/economics.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified financial services organization based in North America. The bank offers a broad range of retail banking, wealth management and investment banking products and services to more than 12 million customers. BMO Financial Group had total assets of $593 billion and more than 45,500 employees at January 31, 2014.