Further falls in GDP to trigger interest rate cuts

Further declines in GDP in the coming quarters mean that the economy is unlikely to grow at all next year. Weak growth and a return in inflation to the 2% target will leave scope for the Bank of Canada to cut interest rates sharply, with the policy rate finishing 2024 at 3.0%. Looser policy should help to drive a recovery in GDP growth to 2.5% in 2025.

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