Economists Cut Canada Growth Forecasts On Floods, But See Rate Hikes On Track

• Floods that wiped out bridges, roads and rail lines in British Columbia will hurt Canada's economic growth and fuel inflation in the fourth quarter, but the Bank of Canada's rate-hike timing is likely to remain unchanged, economists said. 
• Doug Porter, chief economist at BMO Capital Market Economics, halved his fourth quarter growth estimate to 3.0% from a year earlier. That drags down his full-year growth forecast to 4.8%, from a previous forecast of 5.0%, because of the floods and global supply chain disruptions. 
• "For the Bank of Canada, it's not obvious that the weaker growth figures will have much impact as they have hit the supply side and actually threaten to boost inflation even further," he added. 
• Economists are clear the flooding will have a material impact on near-term gross domestic product forecasts, but there is considerable uncertainty about how fast growth could bounce back.

(Source: Reuters)