Post by
canadian on Aug 11, 2024 8:40pm
Interest rate to fall to 2%
For investors, the key take-away here is that the Canadian neutral rate will likely drop to around 2 per cent (from the current estimated level of 2.75 per cent) as a result of slower population growth – more than half a percentage point below the 2.625 per cent estimated in the U.S. Therefore, the BoC will need to cut much deeper (and likely faster) than the Federal Reserve in the U.S., just to get monetary policy back to a neutral stance. This not only creates room for more rate cuts and builds a bullish case for Canadian fixed income but it also signals weakness for the Canadian dollar.
https://www.theglobeandmail.com/investing/investment-ideas/article-rosenberg-research-canadas-looming-immigration-reversal-and-what-it/