Bank of Canada left its interest rate unchanged on Wednesday.
The central bank left its interest rate at 0.5 percent on Wednesday, downplaying the effect of Brexit and low shipment orders from the U.S, according the central bank report.
The report showed the apex bank expect the economy to return to full production by the second half of 2017, a little later than previously predicted.
Policy makers said economic fundamentals are stable over the projected period and lowered their growth forecast for this year from 1.7 percent to 1.3 percent, with exports contribution declining from 1.1 percent to 0.3 percent.
“The export recovery is alive and well,” the central banker told reporters. “You kind of have this narrative that nothing’s happened and yet what we see is actually seven or eight years of recovery, a slow recovery for sure, but one that’s been steady and is now pretty well done.”
The apex bank said the U.K exit from the European Union triggered a sharp asset re-pricing, and will reduce global production by at least 0.2 percent, and Canada with around 0.1 percent by the end of 2018. Post-Brexit effect should be minimal on the country’s economy because of its small exposure to Europe when compared with the U.S., where growth has been better.
The Canadian dollar rose 0.6 percent to C$1.2967 to a U.S. dollar as of 12:13 p.m. in Toronto on Wednesday.