• Expects net exports to pick up through 2013 and business investment to return to solid growth
• Consumer spending expected to grow at moderate pace while residential investment declines further
• Growth in household credit has slowed
• Canadian quarterly growth expected to pick up to about 2.5% H2 2013
• Combined with weak growth in latter 2012 annual growth expected at around 1.5% 2013
• Forward looking growth is projected at 2.8% 2014 and 2.7% 2015 with full capacity expected in mid 2015 – This is later than anticipated in January
• Total CPI and core inflation have remained low in recent months, broadly in line with expectations in January. Muted core inflation reflects material excess supply in the economy, heightened competitive pressures in the retail sector, and some special factors. Total CPI inflation has been restrained by low core inflation and declining mortgage interest costs, with some offset from higher gasoline prices.With continued slack in the Canadian economy, the muted outlook for inflation, and the constructive evolution of imbalances in the household sector, the considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required, consistent with achieving the 2 per cent inflation target.