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According to analysts at National Bank Financial, downside risks to the Canadian economy have arguably increased amidst an apparent deterioration in the trade relationship with the U.S., the latter not only imposing tariffs on steel and aluminium imports but also threatening to slap additional ones on the crucial auto sector.

Key Quotes

“All in all, a deal to revamp NAFTA before year-end is becoming less likely. As a result, we have trimmed by two ticks our 2018 GDP growth forecast to just 2.0% and now expect just one additional rate hike from the Bank of Canada before year-end.”