The BOC is out with a new Monetary Policy Report, which updates forecasts that were made in July.
- 2022 GDP seen at 3.3% vs 3.5% prior
- 2023 GDP seen at 0.9% vs 1.8% prior
- 2024 GDP seen at 2.0% vs 2.4% prior
Inflation:
- 2022 CPI seen at 6.9% vs 7.2% prior
- 2023 CPI seen at 4.1% vs 4.6% prior
- 2024 CPI seen at 2.2% vs 2.3% prior
Other highlights:
- Output gap in Q3 shrank to beween 0.25% an d 1.25% from 0.50% and 1.50% in Q2
- Slowdown in economic activity abroad, especially in the United States, is starting to weigh on exports thought recent CAD depreciation partially offsets this
- High energy costs seem to have passed through to inflation much more than usually, it will take time for these impacts to recede
- Global growth seen at 1.6% in 2023
- Bank views risis around inflation outlook as roughly balanced but upside risk is of greater concern due to persistently high inflation
- Inflation seen returning to 2% target around end of 2024
- A couple of quarters with growth slightly below zero is just as likely as a couple of quarters with small positive growth
Global growth forecasts:
