Bank of Canada governor Stephen Poloz sees lower oil prices now shaving 0.33 percentage points from growth in 2015, compared to the previous estimate of 0.25 pp, in an interview with Reuters.
However, he sees the economy a bit stronger than before and that will offset some of the downsides of lower oil prices.
The Canadian dollar has been fretting about lower oil prices but strong US growth is great news for Canada and if the Fed hikes rates, the BOC won’t be far behind. That isn’t necessarily good news for the loonie against the US dollar but it is on the crosses.
