Canada has experienced fairly solid employment and output growth since the trough of the global recession and is projected to use up spare capacity by mid-2015. Labour force participation has remained near the pre-recession peak, and unemployment is only one percentage point higher than the pre-recession low. Fiscal consolidation is well advanced at the federal level, although less so at the provincial level, and underlying inflation is expected to slowly rise back towards the 2% target midpoint. The sound banking system and strong corporate balance sheets provide a favourable backdrop for a strengthening in business investment. In addition, Canadians enjoy one of the world’s highest levels of well-being.