Toronto and Calgary are running just about neck-and-neck where their economies are concerned, but that may be about to change.
A ranking of major Canadian cities by CIBC World Markets shows Toronto leading the pack as of the third quarter of 2012, followed by Calgary as a close second, Regina and Winnipeg.
The study released today, which measures cities in nine areas, found that Toronto was not at the top in any of the categories, but was high enough in several to come out ahead in the overall rankings.
"Over the past year, Toronto has been benefiting from a recovery in the manufacturing sector, helped by the positive spinoff of the improvement in U.S. auto demand," says the study by CIBC's Benjamin Tal.
"The construction sector, spurred on by activity in both the residential and non-residential segments of the industry, also played an important role in the city's consistent outperformance."
Of course, that was driven by the surge in the city's condo market, which is now cooling and expected to ease further.
Indeed, Mr. Tal says, Toronto may well lose its momentum.
"A softening housing market, the end of many federal and provincial governments' infrastructure stimulus projects, a projected slower growth trajectory in the manufacturing sector and softer retail trade activity will work to slow overall economic momentum in the city in 2013," the study says.
Calgary, in turn, has a strong labour market and solid growth in population.
"As a result, consumer spending in the city has been relatively strong, with retail sales rising by an estimated 9 per cent over the past year. Note that as opposed to Toronto, the residential housing market is playing only a marginal role in supporting activity in the city."