The recession is over. Cue the painful recovery

by Christine on 24/07/09 at 12:52 pm

A billboard appears along U.S. Interstate 95 in Rhode Island. The Recession 101 campaign, which started in the state in July, was funded by an anonymous East Coast donor who was despondent about the way the country was reacting to the economy’s tailspin. It’s appearing on over 1,000 billboards across the U.S.

The recession is over, but not the pain.

Canada’s central bank predicted Thursday that the economy would expand this quarter, suggesting the economic contraction lasted for about nine months, considerably shorter than the previous two recessions in the early 1990s and the early 1980s.

The Bank of Canada’s reassessment of the state of the economy is perhaps the clearest signal yet that the worst of the recession is over.

Buoyed by the prospect of better days ahead, investors rushed to buy Canadian stocks, adding new life to an near five-month rally that economists said has played a big role in reversing Canada’s fortunes.

The Standard & Poor’s/TSX Composite Index rose 243.33 points to 10,675.68, the highest in six weeks. Canada’s dollar jumped about 1 per cent to 92.04 U.S. cents, the strongest in almost two months.

Yet Bank of Canada Governor Mark Carney stopped short of celebration, saying it will take more than a year to replace the wealth destroyed by the financial crisis.

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