housing market: By Sunny Freeman Business Reporter Thu., Oct. 20, 2016 The Bank of Canada held the interest rate at 0.5 per cent Wednesday but cut its economic forecasts through 2018, predicting a slower housing market and conceding the export sector is not rebounding the way it anticipated, according to The Toronto Star. The central bank now expects the economy to grow by 1.1 per cent in 2016, down from the 1.3 per cent forecast in its July Monetary Policy Report, largely due to weaker-than-expected U.S. activity in the first half of the year. The bank has cut its economic outlook, largely because of slower-than-expected growth in the export sector and an anticipated slowdown in housing sales. Gross domestic product growth is expected to pick up to 2 per cent in 2017 and 2.1 per cent in 2018. The Bank didn't cut rates today, but it is warning markets that it is only operating with a thin margin of error when it comes to what might prompt another ease in policy, said CIBC economist Nick Exarhos. The bank now expects the Canadian economy to return to full capacity by mid-2018, about six months later than it had previously expected.
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