the spectrum that are part of the bank ’ s staff tool box. vii chart 5 : estimates of potential output growth from four different models year - over - year percentage change % integrated framework extended multivariate filter multivariate state - space framework basic multivariate filter source : bank of canada estimates last observation : 2018q1 models that incorporate an economic structure are especially useful for projecting tlp growth, since tlp is based on variables and relationships that are difficult to measure and predict. tli growth is comparatively easier to forecast because it is based on accurately observed labour market outcomes : the employment rate, the working - age population and average hours worked. in contrast, tlp growth depends on two variables that are less concrete and therefore more challenging to observe precisely. the first of these, capital deepening, is a measure of growth in the ratio of capital per hour worked. viii the second is a more elusive concept called trend total factor productivity, or tfp. while we have some observable measures of investment and capital stock growth, we do not have the same for trend tfp — which essentially includes everything affecting firms ’ productivity that isn ’ t captured by capital stock growth. these “ residual ” factors include, for example, technological improvements and the impact of education and training. ix another way that the bank manages the uncertainty around potential output growth is by conducting an in - depth review of our projections on an annual basis. first, economic data are regularly revised, so for that reason alone an annual review makes sense. also, our empirical techniques are “ living ” in a sense — we are continually improving them as we learn from experience and ongoing research. x plus, in the annual reassessment, we further account for uncertainty by publishing ranges around our estimates and projections that expand with time. we also list the factors that could lead potential growth to be lower or higher within those ranges. xi i would like to stress that the bank recognizes the difficulties associated with measuring potential and the related uncertainty, and so takes a deliberate and rigorous approach to managing this uncertainty. we work hard to ensure that our models evolve in line with prevailing best practices. and on top of using multiple techniques, we corroborate the models ’ results against other measures of capacity and inflation, and then apply wellinformed judgment. finally, the uncertainty around these estimates is taken into account in the formulation of monetary policy. this helps us ensure that our estimates and our policy decisions are consistent with our broader economic outlook

annual rate, index : 2015q1 = 100 ) index total goods and services total goods commercial services travel services source : statistics canada total services last observation : 2019q4 while many services exporters will struggle until a vaccine is widely available, some goods exporters have been able to adapt safety protocols and bounce back quickly. motor vehicle and parts output, for example, came to an almost complete stop in the spring. since then, the sector has regained nearly all of the lost ground as factories adapted their value chains and production processes. the rapid rebound in goods exports is certainly encouraging. by october, the value of goods exports had recovered almost 90 percent of the loss seen in the spring. if struggling services exporters can hang on until a vaccine is widely available, canada ’ s export performance could avoid the serial disappointment of the period that followed the global financial crisis and help cement a sustainable recovery. of course, this is by no means guaranteed. the rebound in goods exports could fizzle out as companies finish rebuilding inventories, while prolonged hardship could force many services exporters to close their doors. and the underlying competitiveness challenges that have restrained export growth over the past decade have not gone away. more recently, the canadian dollar has been appreciating, largely reflecting a broad - based depreciation of the us dollar. this is hurting the competitiveness of canadian exporters in our largest market. two scenarios for trade where does the trade story go from here? let ’ s imagine a couple of plausible scenarios : one pessimistic, one optimistic. in the pessimistic scenario, the global spread of covid - 19 fuels antiglobalization sentiment and a continued rise in protectionism. this is not farfetched. a recent ipsos poll found significant support among canadians for measures that would make the country less reliant on international trade. the same poll found much less support for measures that would help canadian companies export more. this is troubling because international markets are essential for canadian companies to achieve competitive scale in their operations and because canada benefits from imports in many important ways. in the pessimistic scenario, we also fail to diversify our trade or improve our competitiveness. rivalry and distrust between the united states and china thwart our efforts to develop export markets in asia. investment remains weak, and our productivity growth continues to lag. what ’ s more, new market access for our energy products doesn ’ t come on stream, holding back canada