(Ottawa) Canada’s Conference Board cut its economic growth forecast for this year and next as central banks around the world raise interest rates in a bid to stem rising global warming and inflation.
In the new two-year scenario, the think tank says it does not expect an economic downturn in Canada, but says the risks are increasing.
The Conference Board now expects Canadian economic growth to average 3.5% this year and 2.6% next year. This is a downward revision from its previous forecast for growth of 4% in 2022 and 3.3% in 2023.
He says higher commodity prices are a lifeline for producers in Canada, but other sectors will have to contend with higher interest rates and slower growth in exports to the United States.
The Bank of Canada is expected to announce its next interest rate on Wednesday as it seeks to bring the annual inflation rate, which hit 7.7% in May, back to its 2% target.
Many economists expect the central bank to raise the key interest rate by 0.75 percentage points.
