50 Te t e _ e s c a p e / S h u t t e r s t o c k
B C B U S I N E S S . C A
J A N U A R Y/ F E B R U A R Y 2 0 2 5
renewing their mortgages this year, those
loans will be at a percentage point or so
lower than in 2024.
And yes, inflation has been defeated for
the foreseeable future. "Inflation hasn't
been a problem for several quarters now,"
says Bryan Yu, chief economist at Central
1 Credit Union. Durable goods prices are
actually falling, food prices are normal-
izing. The only components of the Con-
sumer Price Index still going up fast are
shelter-related: rents and mortgage pay-
ments. Those too are expected to moderate
in time.
There's nothing to suggest interest rates
won't keep falling in 2025. Not, perhaps, to
the low levels we saw pre-pandemic, but,
by year-end, to the sub-3-percent level that
makes borrowing feasible.
drop in capital expenditures since 2020.
Those will almost certainly decline again
in 2025.
In fact, almost all of B.C.'s above-average
job creation,
GDP and productivity growth
since 2017, compared to other provinces,
can be attributed to the megaprojects, our
forecasters agree. Without them, some fear
the province will once again drop below
the national average in per capita
GDP.
On a more positive note, the project
completions will be a boost for the prov-
ince's exports, especially of natural gas.
They will also help government revenues.
A WATERSHED FOR
MEGAPROJECTS
This year marks a turning point as four con-
current energy megaprojects, each among
the largest in B.C.'s history, reach comple-
tion and become operational. The first, the
Trans Mountain oil pipeline expansion,
actually turned the corner in 2024, to be
followed by the Site C dam, Coastal Gas-
link pipeline and
LNG Canada terminal, all
expected in the first half of 2025.
The wind-down of construction has
been evident in the sector's employment
and capital spending figures for some time
now. "In the last quarter of 2023, there
was less than 50 cents of new construction
starting for every investment dollar that
ended. New construction projects contin-
ued to wane over the first quarter of 2024
as well," notes
RBC economist Rachel Batta-
glia, a member of the bank's macro and
regional analysis group. The completions
saw capital expenditure intentions dip 5
percent province-wide in 2024—the first
K O O L T U O
C I M O N O C E
