With the vaccination rates continuing to grow, and the reopening programs set up in place among provinces, the economy is expected to rebound substantially starting mid-June. To help the economy head in the right direction, BoC has reduced its bond-buying from $4 billion per week to $3 billion in their last meeting in April, and the bond-buying is likely to be further reduced again to $2 billion per week in July if the incoming date aligns with the BoC’s forecasts.
The Bank has noted that recent job data shows that workers in contact-sensitive sectors have been, once again, affected the most. Although the employment rate has risen drastically compared to the early pandemic days, it is still well below the pre-pandemic level. Another trend the data has revealed is that job loss is more prevalent among low-wage workers, youth, and women as a result of the pandemic.
The inflation rate right now stays around 3% and is anticipated to stay through the summer before pulling back later in the year. The statement reiterates that the BoC will keep the current policies until “economic slack is absorbed”.
"With vaccinations proceeding at a faster pace, and provincial containment restrictions on an easing path over the summer, the Canadian economy is expected to rebound strongly, led by consumer spending. Housing market activity is expected to moderate but remain elevated."
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