Canada to face a longer period of underperformance

Canadian real GDP likely recorded little if any growth in the last quarter of 2015, underscoring the resource sector's outsized impact on the economy's performance. Continuing economic and financial turbulence and lower energy prices are likely to keep Canadian output growth modest at best in the first half of the year.

"Even with a turnaround as the year progresses - based upon expectations of stronger U.S. demand, renewed stabilization in commodity markets and increased fiscal stimulus - Canada's output growth will be hard pressed to average just 1.1% in 2016 - the weakest economic performance among the G7." notes Scotiabank in a report

Under these circumstances, Canada faces a longer period of underperformance. Consumer spending and housing activity across the country will add much less to overall growth as consumers remain cautious on account of moderating employment gains and rising household debt burdens.