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Canadian economy to grow in first half of 2012: OECD

Workers on the line at the GM Canada assembly plant in Oshawa on April 27, 2010. THE CANADIAN PRESS/Darren Calabrese

A new economic forecast says growth in Canada and the rest of the G7 is expected to be firmer through the first half of 2012, but the recovery remains fragile.

The Organisation for Economic Co-operation and Development also says the rate of growth will likely move at different speeds in North America and Europe.

The Paris-based OECD says G7 economies are projected to grow by 1.9 per cent in both the first and second quarters of 2012.

The Paris-based think tank says Canada’s economy is projected to grow by 2.5 per cent during each of the first two quarters, slightly behind the United States.

The outlook for Europe is much more fragile, with weak consumer confidence, rising unemployment and tight credit all pointing to further falls in activity.

The OECD predicts the eurozone’s three top economies — Germany, France and Italy — will shrink by 0.4 per cent on average in the first quarter, before moderate 0.9 per cent growth recovery in the second quarter.

Growth in Japan is projected to rebound strongly in the first quarter to 3.4 per cent, before easing to 1.4 per cent in the second quarter.