Canadian dollar still too high to energise economy

The recent slide in the Canadian dollar doesn't greatly improve Canada's economic prospects. The sharp decline looks overdone in our mind and we wouldn't be surprised to see a rebound, at least a temporary one. Even at its current level, it is still too strong to offset the competitiveness problems that are undermining exports. Accordingly, we still expect the Canadian economy to underperform in 2014, with average annual GDP growth of close to 1.5%.