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OTTAWA –
The parliamentary budget officer is projecting inflation will return to the Bank of Canada’s two per cent target by the end of the year and the federal deficit will grow amid weakening economic conditions.
The budget watchdog’s latest economic and fiscal outlook comes as the federal government gears up for its spring budget and Canadians eagerly wait for the central bank to begin lowering interest rates.
The report predicts the first rate cut to come in April, slightly earlier than financial markets expect.
The Bank of Canada is scheduled to make an interest rate announcement on Wednesday and is widely expected to hold its policy rate at five per cent.
High interest rates have weighed on the Canadian economy as consumers pull back on spending and businesses see their sales slow.
Statistics Canada reported …
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