Bank of Canada Lowers Growth Projections for 2025 and 2026
OTTAWA, Jan. 29 (Reuters) - In its quarterly monetary policy report released Wednesday, the Bank of Canada revised its economic growth forecasts for 2025 and 2026. The updated projections anticipate slower growth due to government policies aimed at curbing population expansion.
The report forecasts economic growth of 1.8% in 2025, a decline from the 2.1% projection released in October. Similarly, growth in 2026 is estimated at 1.8%, down from the previously estimated 2.3%.
Regarding inflation, the bank predicts an average rate of 2.3% in 2025, slightly higher than the 2.2% forecast in October. This increase is attributed to reduced excess supply, rising oil prices, and higher import costs stemming from the Canadian dollar's depreciation. Inflation for 2026 is projected to average 2.1%, up from the 2.0% previously forecast.
It's important to note that these projections do not incorporate potential economic impacts resulting from US tariffs.