The Globe and Mail reports in its Thursday, Feb. 7, edition that deputy governor of the Bank of Canada, Timothy Lane, said on Wednesday that uncertainty over United States trade policies is holding back Canadian business investment and temporarily helping to slow growth. A Reuters dispatch to The Globe reports that Mr. Lane also pointed to lower oil prices and a softening housing market as factors hindering growth, in contrast to the U.S. economy, which is powering ahead on the effects of stimulus.
"The past year has seen an important change in the relative performance of the two economies, despite the fact that the Canadian economy is generally in a good place," Mr. Lane said in a speech on foreign-reserves management to a gathering of economists in Washington.
He noted the bank had raised interest rates by a cumulative 1.25 percentage points since July, 2017, but did not address whether further hikes would be needed.
Mr. Lane said the lower business investment, falling oil prices and softer housing market, coupled with U.S. interest-rate hikes, were putting downward pressure on the Canadian dollar.
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