-- "It could be time for a positive re-rating on Canada," said Rosenberg Research on Wednesday, but it wants to see first what happens to the economy under Canada's Liberal Party as "we've been disappointed before" in that party's fiscal policies.
Rosenberg Research added it is praying the Liberals, under Prime Minister Mark Carney, will pursue pro-business policies now that it holds a majority of seats in parliament.
The research noted Canada has just gone through a "subtle but potentially tectonic political shift" after the Liberals on Monday swept by-elections in three ridings in Canada, which, when combined with five recent floor-crossers from the Conservatives and the NDP, has added enough seats to secure it a formal parliamentary majority.
It's more than just how it becomes far easier to pass legislation, according to the research, in noting the Liberals will now control a majority of seats on every House of Commons committee, and "that is extremely important" because the recent era of opposition parties being in a position to outvote the government and therefore amend bills, launch investigations and delay legislation is "now thankfully over."
This now gives Prime Minister Mark Carney's government the capacity to start pushing some of its positive economic policy planks, related to natural resource development and pipeline expansion, into faster motion, said the research, adding the critical question is which Carney is going to show up. "Will he pursue pro-business policies, or flank left?", the research asked.
"Let's pray for the former," it said, before adding. "The fact that he doesn't have to kowtow to special interest groups or left-leaning parties any longer only has upside."
In essence, the research said, a majority bestows upon Carney the "luxury" of more quickly pushing through bills on energy deregulation and permitting reform, breaking down barriers between provinces, improving defense procurement, promoting international trade, building infrastructure and enacting other pro-growth priorities.
Also, on the plus side for the long-term growth outlook, the research said, a majority empowers the Liberals to avoid the need for side deals with the smaller left-wing parties: the Green Party, the NDP, or the Bloc Quebecois. This was a feature of the minority governments under former Prime Minister Justin Trudeau from 2019 to 2024 and exerted political pressure for higher fiscal deficits and policies that thwarted economic growth, it added.
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