Canada's central banks says recession over

Source: The Star Online

OTTAWA: Canada's central bank is declaring the recession essentially over, saying the Canadian economy will begin growing this summer after nine months of stagnation and lead most of the industrialized world next year.

Bank of Canada Governor Mark Carney said Thursday the economy will grow this quarter.

The bank has dropped its April call for 1 percent contraction this quarter and now says the economy will instead expand by 1.3 percent annualized.

That will be followed by a 3 percent advance in the last three months of this year, and 3 percent growth next year.

But Carney says the economy remains dependent on government stimulus and his own conditional pledge to keep the interest rates at an historic low of 0.25 percent until mid-2010. - AP