Business leaders expect inflation above 3% over the coming year: Bank of Canada
“Suffice it to say that some of the concerns over growth in this report and, especially on inflation, should be behind us,” said BMO senior economist Robert Kavcic in a note to clients Monday, reported by CTV News.
Kavcic said inflation expectations should recede this quarter with global oil prices well off their peak, leaving the central bank able to wait on the sidelines for the rest of the year.
Export outlooks improved to well above the historical average, the Bank of Canada said, helped by higher commodity prices, demand for artificial intelligence data-centre inputs in the United States, and fewer firms reporting that American customers were holding back orders over trade-policy uncertainty.
In the oil and gas sector, West Texas Intermediate crude averaged US$101 per barrel over the bank’s May consultation period against US$65 before the war, and producers revised investment and production plans upward, according to the central bank.
Financial markets point to WTI near US$70 by year-end, the report said, citing Shell plc’s acquisition of Canada’s ARC Resources Ltd as a sign of a more favourable investment climate.
