In this research publication with the C.D. Howe Institute, Don Drummond and Parisa Mahboubi argue economic data are being misinterpreted because expectations have not been reset in the new era of lower immigration. Inferences of weakness should instead be understood as reflections of Canada’s reduced growth in capacity due to lower immigration and weak productivity growth.
The misinterpretations extend to optimistic forecasts, including by Finance Canada and the Bank of Canada, and create grave risks of inappropriate monetary and fiscal policies.
"Resetting Expectations: Canada's Economy in a Lower-Immigration Era," C.D. Howe Institute.