29 April 2014
According to Mr. Poloz, only annual Canadian exports to the United States are $35 – $40 billion lower than expected, based on previous economic cycles data.
The central bank is extremely worried by the fact that Canadian exporters may have not yet recovered from the losses they faced during the recession, even while the global economy is back to normal. As a result, Canada’s economy might keep running behind the rest of the world.
The bank predicts 3.3% global growth this year and 3.7% – in the next two years. However, the Canadian gross domestic product is expected to grow by only 2.5% in 2014 and 2015.
Mr. Poloz noted ones again that the BoC might have to cut rates in case the economy doesn’t show the necessary results. He said the decrease of the Bank’s overnight rate (which remains at 1% since September 2010) was still a possibility. Today the bank keeps its neutral position, meaning the next rate change may be a cut as well as a hike. In the same time, most economists still predict a rate increase in the second half of 2015.