Canada’s new immigration target may impact economic growth, BoC governor says

By Promit Mukherjee

OTTAWA (Reuters) – Canada’s new immigration reduction targets announced this week will likely have a bigger impact on the Bank of Canada’s growth forecast than on the inflation trajectory, Bank of Canada Governor Tiff Macklem said on Friday.

Macklem, however, said there was a lot of uncertainty on how quickly the immigration curbs would be implemented and the bank was yet to assess the new figures.

“If population growth comes down faster than we have assumed, headline GDP growth will be lower than we assumed,” he said.

If household spending recovers more quickly due to continued lowering of borrowing costs by the central bank, economic growth could also be higher, Macklem added.