Bank of Canada’s quarterly report
The Bank of Canada is on the edge about future President Trump’s protectionist policies for it will have repurcursions on the Canadian. Right now, interest rate is .5% although the Central Bank governor, Stephen Poloz says that a rate cut is still an option.
The reason for the maintenance of the .5% interest rate is the expectation of inflation explained in its latest monetary policy. In it, the bank shares its forecast and broad economic assessment since Donald Trump’s presidential victory in November last year. The quarterly report came amidst warnings of experts who believe that the Trump policies could harm Canada economically. So due to their warnings, leaders around the world are trying to forecast what their individual economies and investments will be look under a Trump presidency.
Canada’s gross domestic product is set to grow by 2.1% this fiscal year. Bear in mind that the bank factored in the possible effects of an expected U.S. fiscal boost and the president-elect‘s vow to cut corporate taxes. Although the latter would “threaten” Canadian competitiveness.
According to the bank’s report, the pending fiscal expansion in the U.S. will increase foreign demand for Canada.
In order to protect Canada’s interests, federal officials are trying to infiltrate Donald Trump’s inner circle. Canadian Prime Minister Justin Trudeau has been quote as saying that the senior government officials have had “constructive and positive discussions” with the president-elect’s team.
Household consumption is forecast to be the main contributor to growth in 2017 with the help of the government, of course, along with an expansion of total exports over the next years to come.
