policy response in Canada and the United States softened the sector’s hard landing . Rescuing GM and Chrysler was unanimously seen as necessary to prevent the failure of dozens of regional part suppliers, which could have dried up the supply of parts, affecting solvent automakers and bringing the sector to a halt. The two rounds of bailouts by the Canadian federal, Ontario, and United States governments, helped both Chrysler and GM file for Chapter 11 in the United States in 2009, averting an outright failure under Chapter 7. ( Box 1 provides details of the U.S.-Canada
Canada has experienced drastic changes in its economy during the global financial crisis. This Selected Issues paper discusses the evolution of equilibrium real home prices in key Canadian provinces in the post-crisis period, Canadian dollar movement during and after the global financial turmoil in line with other world currencies, assessment of impacts on Canada’s potential growth, development of Canadian automotive sector—namely, NAFTA partners during the crisis, and the role of Canada Mortgage and Housing Corporation (CMHC) in Canada’s housing market.