Canada's Economy one of the first to recover according to OECD

Courtesy, HEATHER SCOFFIELD, GLOBE & MAIL

But it's too early to say whether a turning point has been identified in global economies, economic group's report says

Canada's economy is in good shape, and it should be one of the first in the world to come out of recession, says the head of the Organization for Economic Co-operation and Development.

"Effectively, Canada will be one of the first to come out of the recession," secretary-general Angel Gurria told business leaders and policy makers Monday at the Conférence de Montréal. His comments follow a report by the organization, one of the world's leading economic groups, signalling a possible "trough" in Canada's recession

Mr. Gurria's assessment backs up a claim of Prime Minister Stephen Harper - that Canada was one of the last countries to fall into recession, and will be one of the first to recover.

The OECD said tentative signs of a trough are also evident in other economies after months of a brutal downturn that has gripped the world.

The OECD report was the second bit of positive news, coming just before Canada Mortgage and Housing Corp. reported that housing starts rose more than 9% last month.

The group said it is still too soon to determine whether a turning point it has identified in several countries is temporary or sustainable, but that its composite leading indicators for April "point to a reduced pace of deterioration in most of the OECD economies."

The organization cited "stronger signals of a possible trough" in Canada, France, Italy and Britain.

"The signals remain tentative but they are present in the majority of the [composite leading indicators] series for these countries," the OECD said.

"Compared to last month, positive signals are also emerging in Germany, Japan and the United States," it said. "However, major non-OECD economies still face deteriorating conditions, with the exception of China and India, where tentative signs of a trough have also emerged."

In Canada, the group said, the indicator rose by 0.4 of a point in April, although was still 7.6 points below where it was a year earlier.

Also in Montreal Monday, Finance Minister Jim Flaherty expressed "cautious optimism that a global economic recovery may not be far behind" the signs already emerging that the credit crunch is easing.