Economic optimism climbing despite looming recession

Optimism is climbing among business leaders even as the majority continue to expect a recession this year, suggesting economic resiliency amid lingering inflationary wage and interest rate pressures, says a survey by CPA Canada. More than a quarter (28%) of respondents are optimistic about the economy over the next 12 months, compared to only 18% in the first quarter of 2023. Still, roughly two-thirds (68%) anticipate a 2023 recession. “Business leaders expect a recession as higher interest rates make their way through the economy, but the rebound in optimism suggests that senior-level CPAs are noticing the resiliency of the Canadian economy,” says David-Alexandre Brassard, CPA Canada’s chief economist. “The economic slowdown is still on the horizon, but it should come later than previously expected and could very well be milder.” The survey also shows that business optimism is starting to rebound, with 56% of business leaders optimistic about the prospects for their businesses in the next year, compared to 45% last quarter.